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Land ownership, value & tax

Just Space housing conference November 2017. Land ownership, value & tax. Rent sucks away the social product for the benefit of landowners, banks, developers… Owners harvest the benefits of infrastructure & other investments

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Land ownership, value & tax

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  1. Just Space housing conference November 2017 Land ownership, value & tax • Rent sucks away the social product for the benefit of landowners, banks, developers… • Owners harvest the benefits of infrastructure & other investments • Crossrail 2 would increase house prices by £60bn, while costing only £30bn, says TfL • Local authorities need a secure, buoyant, income

  2. Just Space housing conference November 2017 What should JS aim for? • Land [and property] value appreciation should be captured for public policy objectives / for the community • For social housing • For social & physical infrastructure • Foster productive investment, not speculation • Bring land forward for public development at lowest cost • Reduce scope of markets, increase public land & commons • Ensure most effective use of land and property in relation to public policy objectives • Reduce wealth inequalities  • Replace bad taxes: council tax, business rates, stamp duty, capital gains…..

  3. Neal Hudson (For m2 add a 0)

  4. Just Space housing conference November 2017 A caution: Reinforcing geographic inequalities • Risk of reinforcing disparities between regions, cities, districts within them • A redistribution scheme is a pre-requisite for any local taxation regime • Until then the channelling of funds to localities via central government may be less evil… • …even though the agglomeration fetish channels too much to London. [not a problem unique to LVT; applies equally to London Finance Commission & similar proposals for locally-raised taxes, local income tax, etc]

  5. Just Space housing conference November 2017 A caution: tax land (+ “improvements”) • LVT incentivises land owners to maximise their exploitation of sites, within the law • Pre-supposes a zoning system to specify how land can be used • UK system does not use such zoning. • Poses a huge problem for valuation: what planning assumptions to make? • Are all intensifications “improvements”

  6. Just Space housing conference November 2017 So what should we do? • Immediate priorities • Compulsory purchase at existing use value • Public land to be transferred at existing use value for public interest projects • To start with, at least, a property value tax with a re-distribution between areas • Easy to compute, could be automated. If Zoopla can do it… • Captures the rent from intensely-developed land; use £/m2 x m2 to make under-occupancy transparent • Base on existing use value, except… • …un-implemented permissions (lagged) • …land allocated in plans (lagged) • …land under option (not sure?) • Replace Council Tax, Stamp Duty, Business rates, + ?

  7. Just Space housing conference November 2017 Next steps • A working group to progress this • J S resources on web site, includingworkshop reports • A reading list, crowd-sourced, is on google drive • m.edwards@ucl.ac.uk

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