The case for a land-value tax

 

Buy land, they're not making it anymore.’ - Mark Twain

The UK economy is beset by three compounding problems: no growth, a high deficit and a constricting straightjacket of regulations. I posit that a reform to land-use planning, partnered with a land-value tax (LVT) substituted for business rates and council tax, offers a potential solution to all of these.

The unique merits of a land-value tax have pressed on the minds of economists for over 200 years. Economics has taught us how to analyse taxes against the criteria of efficiency, equity and revenue raising potential. The taxes most heavily applied in the UK today succumb to the theory of the second best: for example, income tax damages efficiency by perverting labour supply decisions; business rates distort firms’ input decisions, such that scarce resources are misallocated and final goods are not produced in the least-cost way. The key driver of inefficiency in both cases is the responsiveness of the payer, or the elasticity. High elasticities imply a greater distortion and greater efficiency loss.

In accordance with the sacrifice principle of Mill and others, an equitable tax system is one in which the utility burden is equalised across payers. By this criterion progressivity is desirable. Revenue raising potential is a function of the size of the tax base and the ability to avoid or evade.

The LVT is an annual levy on the underlying value of land. What is on top, whether it’s residential housing, a factory or wheat is of no importance, so that an empty plot of land next to a plot with a mansion on are valued the same ceteris paribus. This value is derived from the amenities and infrastructure which surround it, or Ricardian economic rent monies accruing not by virtue of work or returns to capital but by virtue of exclusive rights over the land’s use, or ownership. As described by Henry George in 1879, and more recently by the Institute for Fiscal Studies in the Mirrlees Review, this value is borne out of community effort, rather than individual effort, and therefore its returns should properly be redistributed back to that community.

Since the supply of land is finite and fixed, it is perfectly inelastic. This means that economic decisions are unaffected by the tax and that the incidence coincides with the legal payer (landowner). When a landowner builds a swimming pool on his plot its value increases but his LVT payment remains unchanged; when a public swimming pool is built a short walk away and the value of his plot increases, so does his tax liability. There is no efficiency cost.

One ‘wrinkle’ as the IFS puts it, is that land-use planning laws mean a plot designated agricultural is worth considerably less than a plot designated business (over £2.4m less according to IFS estimates). But this presents a big opportunity. A recent IEA report showed how planning restrictions have led to a chronic shortage of affordable housing and a pernicious degree of intergenerational inequality. The Centre for Economic and Business Research has shown that if house building could be increased by 300,000 units a year between now and 2015, GDP would increase by five percentage points and rents would fall by 11%.

Relaxing planning restrictions would lead to a rebalancing of land designations towards their most profitable use, namely residential housing and business. This would lead to a fall in house and business property prices as supply increased, and windfall gains to land owners. A concurrent LVT would capture some of those gains. As the tax base is observable and fixed, neither avoidance nor evasion is possible, making collection cheaper. Substituted for other distortionary and inequitable taxes such as council tax and business rates, LVT could also increase efficiency. Paired with an overhaul of the antiquated system of land-use planning, it would boost growth and ease budgetary woes. 

If the tax is a replacemnt for local taxes (not national tax), doesn't it become a direct replacement for the old 'rates' but simply based on size of plot and proximity of local council services? Having had our local library and only direct bus service to the local hospital, city centre, train station and schools cut (by our local Green led council) I am all for having a council tax cut! Then again is the bus service a local council service? They licence buses, but they are operated at a profit by private companies... An example of land value tax (maybe based on Brighton and Hove City Council :-) ) would be interesting, and may answer some concerns.
I agree wholeheartedly (but you knew I'd say that). Equally important is that taxes on income or output push down the rental value of land, so it's quite possible that if we subsequently reduced income tax etc by £x billion, the rental value of land would go up by £x billion, and ultimately there's no reason why we can't replace just about all taxes with LVT. Rremember: two-thirds of all taxes collected are dished out again as welfare payments, subsidies, benefits in kind or old age pensions, actual net tax receipts minus cash and other benefits are not particularly high as a % of GDP.
An idea whose time is overdue. This would also capture land value increases arising from infrastructure improvements. After a while, the data collected could be used to provide better forecasting of the external benefits of infrastructure projects. eg is it better value to spend 32 billion on HS2 or on light rail projects or a new tube line in London or new motorways or airports or what? It would take the guesswork out of this kind of decision making.
How exactly are you going to calculate the LVT liability then? If it were calculated purely on locational value, then as you say, a plot with a mansion on it has the same value as plot without a mansion (and indeed no planning for a mansion). Their locations are the same therefore there LVTs should be the same, no? If on the other hand you have to take into consideration planning status, then LVT is no longer a tax on pure locational value, its primarily a tax on planning permissions. Plot A has planning permission for a mansion, value £1m. Identical plot B next door has no planning permission, and is growing cabbages, value £25k. So unless you free planning up to such an extent that you can build pretty much whatever you like where you like, then LVT will always predominantly be a tax on planning permission, not the locational value.
Okay - so who does the valuation?
Very nice summary of the theory underlying LVT Mr Stoddard. I feel this idea's time has come round again. But I would think it is virtually unimplementable in its pure form as the resistance of home-owners and landlords would be vast. There is no popular understanding that the value of a plot could fairly 'belong' to the community. The old lady in a big house argument always comes out, as does the argument that the freeholder is the rightful owner of the land price gains resulting from local infrastructure developments. After all it was his/her shrewd investment wasn't it!
The tax needs to be national not local. There are orders of magnitude of differences between land values in, say, Westminster, Weston Super Mare and West Bromwich. Likewise between grade 1 arable land in East Anglia and poor quality uplands grazing. These differences would be reflected in the valuation and hence the tax payable. Under any system of taxation, there are differences in the taxable capacities of different areas. This is why LVT cannot be a local tax. The issue of local government finance is a separate matter. One option is to give local authorities democratic control over a pot of money handed out according to a formula based on population and other factors. Who would do the valuation? Professional valuers. The valuation of land is their daily work. The system needs to be open, with an appeals procedure. When land values are plotted on a map, anomalies are obvious. The influence of planning permissions is varied. Where there is no underlying demand, planning consent is worthless. Obviously it would be unjust to value land on the assumption that it was developed, if there was no consent for the development. Because it is possible for third parties to make planning applications, there is no question of owners sitting on developable sites to avoid paying their LVT. In most circumstances, the valuation would be existing use value. But this means the tax could not be avoided by "constructive demolition". This is a potential problem with a mansion tax. An owner might convert part of the west wing into stables and buy some thoroughbred horses, to take the valuation below the threshold!
Jim writes: "If on the other hand you have to take into consideration planning status, then LVT is no longer a tax on pure locational value, its primarily a tax on planning permissions." This is related to the argument against a land value tax made by David Ricardo--that the value of land would depend on how it was taxed, with the result that land would end up being owned not by those best able to use it but by those with the best political connections. Duncan writes: "In accordance with the sacrifice principle of Mill and others, an equitable tax system is one in which the utility burden is equalised across payers. By this criterion progressivity is desirable." That does not follow. Equal utility burden requires (assuming diminishing marginal utility of income across taxpayers) that people with higher incomes pay more, but not that they pay proportionally more. It's an argument against a head tax, not a flat rate tax.
Jim sets off on his usual wild goose chase: "If it were calculated purely on locational value, then as you say, a plot with a mansion on it has the same value as plot without a mansion (and indeed no planning for a mansion). Their locations are the same therefore there LVTs should be the same, no?" He knows perfectly well that the fuller definition is "A tax on the rental value that accrues to any site above and beyond the value of the owner's improvements assuming optimum permitted use" So if a plot of land has no planning permission, the taxable value is so close to nil as to be not worth taxing. Much the same applies to most farmland. But by and large, most land does have roughly the right sort of planning permission, its only five per cent or so of urban land that is derelict or hampered by planning restrictions. LVT works perfectly well with or without liberalised planning laws and the two topics can be considered separately. Robin: "Okay - so who does the valuation?" The Valuation Office Agency would do the valuations, the same as for Business Rates or Council Tax. Im amazed anybody even asks the question. These would be based on the fourteen million sales and actual plot sizes, planning permission and selling prices recorded by HM Land Registry (with extra info from the council tax register which covers the stuff not actually registered at HMLR) over the last twelve years (about half of all homes have been bough and sold at least once in the last twelve years) suitably adjusted to arrive at relative rental values as at todays date. The whole thing can be computerised and requires some understanding of maths. Have you never wondered how Zoopla and all these other web sites do their instant valuations? I shall now sit back and wait for somebody to play the Poor Widows In Mansion bogey :-)
@ Jim. Three bedroom Victorian terrace house in Neath £30,000. Same house in Mayfair £3,000,000. LVT is very much a tax on location.
@ Anon, ah yes, but what if the person living in that Mayfair three-bed is a Poor Widow whose husband died in WW2 and who bought it for tuppence ha'penny in the 1940s when it was a bombed out wreck and has worked hard to pay for all the improvements which she paid out of income which had already been taxed, bearing in mind she worked for forty five years as a low-paid nurse in the NHS and now she does a lot of work in the local community and all her family memories are stored up in that house and forcing this poor individual out on the street would literally kill her and really she is only hanging onto the house so that she can pass down wealth to the next generation and release a bit of equity so that she can help her heirs build up capital and get a foot on the property ladder because we are a property owning democracy and without land ownership all legal rights are worthless it's the bed rock of society and anyway it's the immigrants who are to blame for pushing up house prices and those evil bankers (continued page 94)?
@Mark Wadsworth - you forgot to mention the huge volume of commercial and residential rental transactions that take place every year. A 100 sq metre house in Sunderland is around £500 a month. The same property in Brighton lets for around £1500 per month. The land value in residential areas of Sunderland is negligible and can be taken as zero, which gives an annual land value in Brighton of around £12k. Land rental valuation is a doddle. You can get most of the information from http://www.rightmove.co.uk. Put the information on a map and anomalies stick out a mile. Ricardo's comments about land value tax merely emphasise the importance of getting the system right from the outset. Valuations must be annual rental and they must be kept up to date. The valuation must be on the assumption that the site was developed in accordance with the consent or established use in the planning register. Third party planning applications are already permissible so owners cannot avoid payment by refraining from applying for consents for land that is ripe for development. If they then want to withhold land for development once consent has been granted then they are free to pay the appropriately high LVT.
A pilot study undertaken by Glasgow City Council demonstrated that there were no technical barriers from a valuers perspective to the introduction of LVT. I wrote a report outlining how such a levy might be introduced for Scotland and am currently doing the same for England & Wales. See http://www.andywightman.com/?page_id=1050 for link to the report and other resources.
Mark, what if you are happily living in your home, then the council decideds to grant planning permission for a shopping centre on your plot? Your tax bill makes your whole plot is valueless to anyone other than a major property developer... how do you get out of you £1,000,000 monthly LVT? Surrender the land (with your home on it) to the council?
Mark, what if you are happily living in your home, then the council decideds to grant planning permission for a shopping centre on your plot? Your tax bill makes your whole plot is valueless to anyone other than a major property developer... how do you get out of you £1,000,000 monthly LVT? Surrender the land (with your home on it) to the council?
@ Henry Law, yes of course, the Normans managed to compile the Domesday Book recording every acre of our island and all rental values using quill pens in a couple of years, nowadays it's all on Rightmove, with a far higher degree of accuracy available at the tap of a keyboard. Even by Fatty Pickles own admission the whole valuation exercise would cost about £10 per house. @ Andy Wightman, why stop at Council Tax (highly regressive) and Business Rates (mildly regressive)? Surely we ought to use LVT to replace SDLT and IHT (hyper-progressive to the point of being jealousy surcharges and grossly inefficient) and the TV licence fee (hyper-regressive) while were at it?
@Mark - happy to incorporate SDLT etc too. My brief for 2010 study was only business rates and council tax. See my latest blog for proposals on SDLT devolution in 2015. Worth noting too @Henry Law that Inland Revenue surveyed every hereditament in GB & Ireland 1012-1914 using ink and paper. They valued every lot incl improved and unimproved value. See Chapter 11 in my book, The Poor Had No Lawyers & Brian Short's Land & Society in Edwardian Britain, Cambridge Univ Press
Paul, if my monthly LVT was £1,000,000 as a result of the scenario you describe, the annual LVT would be £12,000,000 which, assuming that LVT was 6% or less of the land price per annum implies that the selling price would be at least £720,000,000. I could sell up, use £20,000,000 to buy an estate in Scotland, waste the other £700,000,000 on riotous living and spend the rest of my life sobbing over how the council done me wrong. Nah. I'd be so happy that all that sobbing would be too much like hard work.
@ Paul Perrin. £1,000,000 per month LVT? That's quite a nice little plot.
Oops, cock up in the maths. So the land value should be £200,000,000 rather than £720,000,000 but does it change the point much? Not really.
It is clearly unjust that a person should face a higher tax bill through no fault of their own (predatory granting of planning permission, or provision of unwanted services or infrastructure). So, all affected property owners would have to be given the right of veto over any such permissions/improvements. If content, then an owner might veto new roads, railways, etc. It would then be for the state to compensate any land ownder (LVT payer) for the consequential cost of waiving their veto. Personally I wold happily waive such a veto - m price would be an exclusion of the land from any change in LVT liabiluty in perpetuity... I think most other property owners would concur. LVT - would either be draconion or stillborn.
@Adam smith fan - who would you sell to? If you were very lucky there may be one buyer actually interested in that development at that time... but you liability of x,000,000 a month would make you very happy to GIVE the land away - Forget your home that sits onit! If donald trump gets planning permission for a golf course, you are stuck with the tax bill for good. But what if someone applies for permission for a golf course near by? If it is a case of 'its ok, but only if the other one doesn't go ahead who pays what in tax? On day one, Id aply for planning permission on all my neighbours plots - lumber them with the tax bill, while defending my own plot with an appeal of 'no one can build here, the area is already saturated' I am open to arguments, but LVT seems like a utopian pipe dream - in reality 100% impractical, unjust and open to gaming. And if it needs an arbitrator, why not just get the arbitrator demand precice amouts of tax from every one and stop pretending it is linked to any thing apart from who won't vote for the sitting government (whoever they happen to be) anyway?
just an observation... we should certainly end the existing *negative* land tax. Land owners get paid by the state for 'set aside', 'conservation', windmills etc... land owners are paid by the rest of us to ensure that they can continue owning that land in perpetuity! No Fair!
But that's the thing, Paul. If there is really so little interest in buying your plot then there's no way the appraiser is going to give it such a high value, planning permission or no planning permission. Appraisers have to do this work all the time for insurance companies, tax authorities, buyers, etc. If they're out more than 10% high or low, chances are they get sued. So the free market and the threat of litigation keeps them honest. If no one will buy the land for £200,000,000 this year, it's not worth that much this year and no competent appraiser is going to value it that high. Having said that, even if there's a chance that the plot will sell at £200,000,000 in the next 20 years it would be worth your while financing the LVT with a loan while you hold out for your price.
@ Paul 23.07, 1. Well seeing as I don't own a plot of land large enough to put a shopping centre on, and neither do most people, I can safely answer that question with "No that is not a worry at all" 2. There is no reason to assume that land goes up in value were it to be re-zoned from residential to retail - do you actually have any facts or figures to support your assertion that the rental value of a shopping centre is a hundred times as high as residential? 3 Do you have any idea how big shopping centres are? 4. No shopping centre developer would ever go to the hassle of applying for planning permission for a shopping centre on some housing estates - that would involve buying up hundreds or thousands of houses, the grief and cost would be unimaginable - the developer would much rather build it in the town centre or out-of-town and negotiate with as few people as possible. 5. And so on - Im happy to answer questions, but please, can we stick to "things which might actually happen in real life"?
@Paul, I agree with Mark. Thee is a tendency in this debate to speculate on various happenings and question what the (usually) unpalatable outcome would be were LVT to be in operation. Like Mark, I contend that such applications would be as unlikely under LVT as they are now. Can you provide one example of where this has happened in the UK to date? No developer would go to this kind of bother with the complexity of buying out so many titles. Even if they did, as Adam Smith Fan points out, it is the market value of the land at current permitted use that is the basis of the assessment. If planning permission were to be granted for a shopping centre on the top of the Cairngorms, the land value would not change one iota because there would be no market for such land since it would not be an economically viable proposition. Neither would it be an economically viable proposition to attempt to build a shopping centre where there are currently 100 or so residential properties.
Mark, your lack of imagination surprises me. I give an extreme example to make a point - but it applies on a smaller scale too. Where is the new london airport going to go? Such a thing could cover many small plots. A garden is virtually worthless - but get planning permission for some infill housing.. And the value of your land doubles - doubling your tax bill - like it or not. What about HS2 ? Are propereties along the lne blighted or blessed? Will it actualy happen? Guessing the 'potential value' of arbitary planning permission doesn't seem to add any clarity at all.
Paul, I'm the one sticking to real life here - your claim that land rental values go up one-hundred-fold if rezoned from residential to shopping centre is frankly ludicrousEk1vF. I've done a worked example re your shopping centre on my blog (click my name for article). If you want me to do the same exercise for a new airport (which any sane person would build out in the countryside anway) I will do so. As to what the uplift is, that's up to the developer to OFFER, isn't it? He can agree his LVT bill in advance with the council, and the council will only grant planning if the LVT from the shopping centre, airport, whatever, is significantly higher than what the council is already collecting in LVT from the housing, farm, whatever.
Paul: "I give an extreme example to make a point - but it applies on a smaller scale too. Where is the new london airport going to go?" Wot? An airport is "smaller scale" than a shopping centre? Do you know how big an airport is?
How to assess land for land value taxation is not a philosophical question. There is solid empirical evidence. Denmark has decades of experience with such assessment, going back to 1917. An e-mail to the office for land assessment (Ejendomsvurdering) of the Danish Ministry of Customs and Taxation (Told og Skat) should get you much interesting information. Denmark assisted Estonia when the latter instituted a land tax in 1992.
Well I for one am absolutely convinced by Henry George's fantastic idea, and would vote for any political party if LVT was their number one manifesto pledge.
The validity of using land as the basis of public revenue is not in question , but it's just a pity that the killer terminolgy of Land Value Tax that has hindered its application for 100 years is still being used. The issue is the collection of 100% societally generated Land Rental Value. We cannot collect any % of capital value as land does not have any capital value. We are, in the current discussion also not sufifciently raising the issue of how we could use LRV to reduce the main killer -income tax- and indeed replace it. Tax is a three letter word for bad and Joe Public understands that only too well. We are also not emphasing the potential stabilising influence of LRV collection on the 'property' speculation that is got us into yet another bust, inherent in the land monopoly capitalist, boom and bust metabolism.
More merriment with Paul: " A garden is virtually worthless - but get planning permission for some infill housing.. And the value of your land doubles - doubling your tax bill - like it or not." More nonsense on stilts, which only applies if only a very small number of gardens get the extra planning. If the law were changed tomorrow so that every single home owner in the whole country were allowed to build double the current density on his plot, then very few would end up doing it - because most people like having a back garden and don't want to live in a flat - and the few people who move out of an existing house with garden and into a flat would free up more houses available for sale, pushing down their price - and by and large, the total value of all land would remain much the same.
Mark 'small', 'large' based on the size of the change in taxable value. I gave an fictional exampl of a massive increase to demonstrate a point. However, I don't think you have anything worthwhile to say to me, so think it best to end our interation.
Mark 'small', 'large' based on the size of the change in taxable value. I gave an fictional exampl of a massive increase to demonstrate a point. However, I don't think you have anything worthwhile to say to me, so think it best to end our interation.
If planning permission increases the value of land for the purpose of tax then surely the 'unimproved' qualifier seems redundant and misleading. As surely this would mean that all land would be taxed as if it had already been improved to the maximum extent possible! As I said earlier, superficially lvt seems quite attractive, but any close inspection seems to turn it into a can of worms. I am open to persuasion, but it needs to address the points, not just poo-poo objections.
Paul, try giving a real life example. No doubt there will be some examples where the new development uses the land much more efficiently and hence will generate a larger amount of LVT for the community - so please give one. I see no reason why these should not go ahead. If your fictitious example where the council can get an extra £12 million a year by simply re-zoning your back garden as a shopping centre, why on earth shouldn't they? That pays for another couple of public libraries, a few dozen more lollipop ladies or old age carers, nursery places, whatever, not to mention the extra jobs involved in building and staffing the shopping centre. What's not to like? How is any of this in any way negative? Assuming you have no sensible, real life answers to my questions I hereby declare myself the winner of this debate by default.
Enjoying all the comments guys! Was preparing an answer (copying and pasting IFS quotes) to the somewhat dated 'how would we value it' thing but see that's been deftly swept aside. Thanks Mark and Andy for your helpful blogs.
@ Paul P, Ive looked up a few facts and figures on airports, and it turns out that the notion that people would buy up urban housing in order to knock it down to build airports is rather fanciful, as using urban land for housing is just as profitable. The airport covers 4.7 square miles = 3,100 acres, at a density of 10 homes/acre (low by London standards) = 31,000 homes, which you could reasonably rent out for £15,000 each a year = total EBITDA £465 million. Or flog off the land for easily £1 million/acre, you'd get £3.1 billion for it. And that is a stress and hassle free type existence, far simpler than running an airport with 70,000 employees and 70 million passengers and 400,000 aircraft movements etc. How much does Heathrow earn for BAA? Not quite clear, but it appears to be in the order of EBITDA of £500 million, with far higher political risks etc. Have you never noticed that when new airports are built, they are built out of town? This is not just a safety thing, it is a land cost thing. Suffice to say, even if the local council went totally mad and granted planning for an airport, including your back garden, your LVT bill would not go up :-)
@ Henry Law on Tue, 04/09/2012 - 18:46. Concerning local Government, how do you propose to keep some relationship between the electorate and how much or efficiently the Council spends money? After all, I assume they would all receive a 100% block grant. My answer would be that an efficient Council would be able to offer a rebate on any surplus. A local citizens income if you like. Any thoughts?
Mark, as I have already said, you have nothing useful for me, so kndly dont addres me - rather than trying to provoke a pointless row (which younwill fail to do).
Duncan, what do you want from discussion here? Pats on the back for raising the issue? Or maybe to discover some useful arguments to address issues raised against LVT? If its pats on the back, Ill happily leave you to it - and assume that there are no answers to the concerns that I raise. I think LVT has an initial attraction - but if its supporters response to questions is patronising abuse, you have lost already... maybe you are happy with that and have no real belief that it could ever be brought about - if so Ill save my typing...
Duncan, what do you want from discussion here? Pats on the back for raising the issue? Or maybe to discover some useful arguments to address issues raised against LVT? If its pats on the back, Ill happily leave you to it - and assume that there are no answers to the concerns that I raise. I think LVT has an initial attraction - but if its supporters response to questions is patronising abuse, you have lost already... maybe you are happy with that and have no real belief that it could ever be brought about - if so Ill save my typing...
Ok, enough is enough - I have wasted enough time investigating LVT - whatever the good/bad about LVT, its clear that its supporters don't have enough confidence in their arguments to engage with questioners, so best pushed to the back of the shelf.
That's what you get for apostasy Mr Wadsworth.
Benj, I'm not sure what apostasy is or what I got for it. However, I do know that the rental value of shopping centres is not a hundred times as much as for residential. I also know that the rental value of Heathrow is barely higher than residential land in the rest of London and that airport operators like building out in the countryside rather than buying up tens of thousands of houses. So I sort of struggle to answer questions which are based on totally unrealistic assumptions. I mean, if we are allowed to make up facts as we go along, then I can argue that VAT is the worst tax because it leads to more burglaries (it must do, because it pushes up the price of new goods, making second hand ones more desirable).
@ Mark, it was a lame joke in reference to you being a former member of UKIP which, by the looks of it, Paul has stood for in elections. I was speculating that it might be this, rather than your reasoned (IMO) response that is the cause for the upset. From Wiki "Apostasy is the formal disaffiliation from or abandonment or renunciation of a religion by a person." Apostasy is punishable by death in many Muslim countries.
Benj, aha, thanks for clarification. I am in fact not some sort of heretic, I am a mainstream, run of the mill mainstream land value taxer, some are far more extreme than I am, others far more moderate.
How could we all have missed it? The solution to the housing crisis and our poor economic performance was right under our noses in the back garden all along! Build an extension everyone, and our problems will be solved! But to be serious! Coming late to this excellent debate I would like to thank the IEA and Duncan Stoddard for supporting LVT and hope that further articles can examine the many benefits of the reform – e.g. it is the only tax that cannot be passed on in higher rent or prices; cannot be avoided; zero rated marginal land will ensure competitive rents, and hardship cases will be accommodated. LVT is not a penal tax – it is a fair method of funding public services and infrastructure improvements from the land value created by the community. By collecting the annual rental value of land (Ron Greer please note!) taxes on wages, production, sales, profits and savings could be rapidly reduced with the intention to abolish, along with council tax and UBR. The immediate effect would be an increase in take-home pay and demand for goods and services. Landlords and developers would benefit from the immediate demand for modern homes, retail, office and commercial premises with best facilities. Is there anyone who wants to go on working for 6 months of the year just to pay taxes while a change in the system will provide higher, tax free wages, lower rents and prices and an incentive to invest in research and production?

@Mike Hawes - I should point out that articles on the IEA blog are published for discussion purposes and that the publication of this article does not mean that the IEA supports LVT. The IEA has no corporate view on this matter.

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