Lord Peter Mandelson has described proposals to introduce a mansion tax as “crude” and “short-termist”.

On Newsnight the ex Labour cabinet member advocated the Liberal Democrat plan of adding additional council tax bands to collect more taxes.

Lord Mandelson said:

‘I don’t happen to think the mansion tax is the right policy response [to tackle inequality] , I think it’s crude, I think it’s short-termist.’

The mansion tax, which has been adopted by Ed Miliband as party policy, is a tax on owners with property worth more than £2 million.

It’s been suggested that over 88,000 London houses will be affected by the proposed tax (88% of total houses).

The Labour Party would hope to raise £1.2 billion from the tax. The raised money would be spent on hiring an extra 38,000 nurses for the NHS.

London Mayor Boris Johnson labelled it as “a tax on London“.

Lord Mandelson admitted that the Liberal Democrat proposal may take longer to implement, but would prove to be more “effective and efficient.”