TAX rises should be used to rein in future property price bubbles, according to a Bank of England policymaker.
Adam Posen, the newest member of the bank’s rate-setting Monetary Policy Committee (MPC), said “modest” increases in taxes such as stamp duty and capital gains tax could help prevent the housing market from overheating.
In a speech at a financial conference in London, Mr Posen said monetary policy tools — such as interest rates — should not be used to tackle asset price booms. “The bottom-line for monetary policy coming out of the crisis is, if you have a financial problem, use financial policy tools to fix it,” he said.
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