Comments on: Opinion: Lib Dems must support LVT

By: Grammar Police

Grammar Police — Sat, 15 Sep 2007 10:53:40 +0000

As someone who, admittedly, has paid little attention to LVT, I don’t really understand how it is necessarily fairer to tax the value of someone’s property as opposed to their actual income – from all sources. That is the major problem I have with council tax (which, originally at least, is linked to the value of the building that stands on the land). Most people won’t appreciate the difference between land value and building value – and I’m not entirely sure that I do. Legally, at least, the price of a house is actually the price of an estate in the real property. I can see that unbuilt land is going to sell for less than built land (at least on the housing market) . . . anyway, I’m just getting confused now – and that’s going to be a real problem if I had to explain to the voting public.
Will the removal of a domestic property tax really lead to such an unbridled rise in house prices? Disposable income of the better off will reduce with LIT, meaning a reluctance to buy expensive properties, thereby reducing demand, whilst the monthly income of the less well off will actually be improved, meaning that many attempting to get on the housing market will find it easier? Isn’t that the theory at least in basic terms?

By: Paul Griffiths

Paul Griffiths — Sat, 15 Sep 2007 10:09:15 +0000

“It is far fairer than LIT, taxing wealth rather than work.”

Now, right there Tristan you’re running in to trouble. I believe that most voters would find those eleven words completely baffling.

Wealth is what other people have. No typical voter thinks of themselves as wealthy, and they will not take kindly to your proposal to tax them as if they were.

Nor do people regard the accumulating value of their homes as wealth. Certainly I don’t. The market value of my flat has gone from £45,000 to £125,000 in just over 15 years. Presumably the value of the land on which it is built has increased proportionately. But when I come to sell my flat in the next few weeks, it will cost me at least £140,000 to buy an equivalent property, and I’ll be even deeper in debt than I am now.

If I continue getting wealthy at this rate, I’ll spend my retirement eating cat food straight from the tin.

In contrast, people have an intuitive grasp of income tax as “the subscription we pay to live in a civilised society” (as somebody famous once said). If asked, I reckon they could even come up with an reasonable explanation for progressive income tax.

But if you asked them to explain why they should instead be taxed according to the value of the land on which their over-mortgaged house is built, they will stare at you blankly. And frankly, so will I.

By: Tristan Mills

Tristan Mills — Thu, 13 Sep 2007 07:31:14 +0000

Well, its been sold to the public before, albeit a hundred years ago…

We can easily start by saying how it is fairer than council tax because any improvement you make to your house is not taxed – it is simply the land value.

It is far fairer than LIT, taxing wealth rather than work.

You can sell it as ensuring land banking doesn’t happen – you pay tax on unused land too.

As a redevelopment incentive – unused land is taxed giving an incentive to actually use the land.

There is lots of room for that. The aim of ALTER is to sell it to the party, which should be able to digest more than Focus style snippets especially if we’re going to campaign on it.

By: Dominic

Dominic — Wed, 12 Sep 2007 20:30:44 +0000

Sadly have to agree with Paul at 2 above. ALTER should put some real effort into designing some kind of shadow campaign pack (in digestable, Focus-ready form, complete with photos and no more than 50 words per article). That would be the real test of whether this is a remotely saleable policy rather than a theoretical pipe-dream.

The absence of any such work strongly suggests to me that this is a non-starter as party policy.

By: Paul Griffiths

Paul Griffiths — Wed, 12 Sep 2007 17:48:40 +0000

The reason why the CentreForum piece attracted little attention was because it was turgid in the extreme and comprehensible only by people with degrees in economics. Sadly, every ALTER publication I have ever seen suffers the same defect. Maybe “Location Matters” will be different, but given its provenance I’m not holding my breath.

By: Letters From A Tory

Letters From A Tory — Wed, 12 Sep 2007 08:27:08 +0000

Despite the good work done by David Cameron in terms of getting people talking about environmental issues and localism, there is still a lot of scope for all political parties to put together some coherent policies on the subject.

Just wait for the next Cameron implosion when the Quality of Life policy group reports back tomorrow….