Labour's Annual Land Tax~how will it affect you?

[apbremer]

Take the value of your house, subtract building cost equals land value. Apply initial rate of 0.85% rising to 3%, so typically ?500,000 for ED but let's be be generous and say ?400,000 = ?3,500 for first year rising to ?12,000 pa . Sounds sensible, eh? Happy with that, Helen Hayes, and subsequent collapse of housing market? Is Corbyn mad or just seriously deluded?

[jaywalker]

Other countries have this system of local taxation, including some states in the USA. They are not, presumably mad and/or deluded. It is to replace business rates as well (which I suspect no one thinks is even remotely a good system). As with any tax, the calibration on the actual percentage rate occurs once land-values are assessed (as Council Tax bands are currently - they have, you may have noticed, precious little to do with current house prices). Only then do you know the tax base and can set a percentage that generates required tax revenue.

For sure, the idea here is partly a wealth tax. In France they just add up your assets - and in ED anyone owning a house would be over the threshold. This might have advantages in terms of distortions: people may be inclined to sell off their gardens rather like you can still see blocked up windows after that tax. Generally, if you want a wealth tax its best to apply it to total assets to avoid this. But are you saying a wealth tax is a bad thing? If so, why? Presumably you can see that it might be more equitable, given that it is steeply progressive on wealth in a country where public services are grossly under-funded and where substantial numbers of people cannot afford to buy their own home?

If the housing market collapses (as it is likely to do for other reasons than this) then that would adjust the distribution of the tax, no?

[Green Goose]

apbremer Wrote:

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> Take the value of your house, subtract building

> cost equals land value. Apply initial rate of

> 0.85% rising to 3%, so typically ?500,000 for ED

> but let's be be generous and say ?400,000 = ?3,500

> for first year rising to ?12,000 pa . Sounds

> sensible, eh? Happy with that, Helen Hayes, and

> subsequent collapse of housing market? Is Corbyn

> mad or just seriously deluded?

Let's just be kind and say that he does not have a clue about economics and market forces.

He wants to hit the property owners but he forgets about the fct that they also own the properies that tenants live in. He hasn't realised that rents would have to go up to compensate.

On the day his launched his Party's new policy on childcare, he didn't have a clue on what it would cost. Just like Diane Abbott's 10,000 fantasy policemen. And 3,00 extra firemen and 20,000 teachers. They are happy though because the Magic Monet Tree will be like the golden Goose and provide the where-with-all to do it. Plus of course pay for nationalising the rail companies, National Grid, the Water, Gas and Electricity providers. Plus pay for the University fees. I could go on but the list is far too long.

He is seriously deluded.

[JohnL]

How on earth do you get the above figures from

"We will initiate a review into reforming council tax and business rates and consider new options such as a land value tax."

https://fullfact.org/economy/labours-land-value-tax-will-you-have-sell-your-garden/

[JohnL]

It isn?t being proposed as an additional tax, but as a potential replacement for council taxes and/or business rates.

So people taking up the most land (never mind what's built on it) pay more - OK by me in my small footprint flat

And originally proposed by Adam Smith :)

[apbremer]

All semantics and dodging the question. If you are now paying around ?1500 pa in Council tax this will at least double initially with massive further increases. So "We will initiate and...consider new options such as a land value tax." If you believe that this is not forthcoming under a Labour Government you will believe anything!

[JohnL]

Anyway Australia has a Land Tax

https://www.finance.wa.gov.au/cms/State_Revenue/Land_Tax/What_is_Land_Tax_.aspx#rate_scale

Notice the scale shows up to 300,000 A$ the tax is a flat rate of 0 A$, from 300,000 to 420,000 it's a flat rate of 300 A$

then it hits 0.25 % etc.

[apbremer]

If this old Loon Corbyn got in (God help us)with the prospect of this absurd Garden Tax, logically this would happen:

House values would collapse to a level where, as the building cost is more or less stable, the site value would drop to a figure where the levy would cost about the same as the present affordable council tax, which would be abolished.

Residential values typically in ED would halve to about ?450,000 ie ?50,000 X 3% garden tax =?1500 pa.

Great swathes of the country would be decimated, many with massive drops in residential values.

Every bank and building society would become insolvent.

There would be financial Armageddon with the pound in freefall,interest rates and inflation at Weimar Republic levels, BOE printing presses rolling day and night and UK and our citizens largely bankrupt and in massive negative equity. Just like Venezuela which Corbyn so admires.

Frantic general election with The Tories sweeping back into Government in their habitual role of clearing up the mess Labour always leaves.Don't forget the Labour minister of the last Socialist shambles "There's no money left".The difference this time with this crazed Marxist lot is that it will take decades to restore the economy if ever, particularly with the mass emigration of so much talent and wealth which would undoubtedly occur.

Actually I think that this Tory government is also pretty clueless as to how the economy works and prosperity is created despite State interference, but is infinitely better than the useless alternative.

[Borky]

lets make it part of EDF strategy to have at least one thread per week that is not based in rambling baseless lunacy. If we pull together, we can make this happen

[Lordship 516]

Read about Henry George & [Progress and Poverty ] & Land Value Tax. You can also read about what Adam Smith [The Wealth of Nations] & even what Milton Friedman had to say along with Paul Samuelson, Paul Krugman, Joseph Stiglitz all of whom support this form of taxation.

Fear mongering that your land will be taxed at 3% of it's value is entirely wrong. It is likely to be taxed at about the same as Council Tax but those who currently have large land & property resources & store their wealth there to shelter against taxes would find themselves losers under this method - suddenly they have to pay their fair share.

There is another benefit - for landowners who are hoarding valuable sites that houses could be built on this tax will force them to develop or sell out to someone else who will develop & make land less scarce - this will reduce the cost of housing by making houses plentiful; not so good for speculators but very good for those who need housing.

It is possibly the most fair & efficient tax that could be employed & thus the Conservatives will be against it. Fairness is not on their agenda. They have slurred it as a 'Garden Tax' to stir up an emotive opposition to this form of progressive taxation.

[KidKruger]

I saw a clip earlier today of Jeremy Corbyn slating Tory Govts for allowing Corporations off scott-free while 'the people' pay for austerity.

Wouldn't a tax as outlined above be effectively the same thing (but targetted at home owners) ?

Can everyone seriously pay ?3k every year going forward (going up to ?12K ?!), some people have been born in their houses. What if they're unemployed, retired, disabled, ?

[JohnL]

KidKruger Wrote:

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> I saw a clip earlier today of Jeremy Corbyn

> slating Tory Govts for allowing Corporations off

> scott-free while 'the people' pay for austerity.

> Wouldn't a tax as outlined above be effectively

> the same thing (but targetted at home owners) ?

> Can everyone seriously pay ?3k every year going

> forward (going up to ?12K ?!), some people have

> been born in their houses. What if they're

> unemployed, retired, disabled, ?

It wouldn't be that much I'm sure