What would a land value tax look like instead of council tax?

[Newmeagain]

Just saw something about this in the news. Concerned about potential impact on home owners in London who may not necessarily be wealthy - ie no other assets to sell and not a huge income.

does anyone know?

Do you have any links?

I'd be interested to know this too, surely council tax bands are already based on the value of the home and so the impact on those with big assets but low income would be no different? I don't think I really understand the implications yet.

Just the same with different winners and losers and a great deal of uproar. And probably years to do the valuations.

England only. Although council tax reform further along in wales so need to pivot to value tax is lower.

Back to 1600s London with overhanging upstairs because you were charged on the footprint? Rise in value of big (tall) houses on small plots? City centres even more unaffordable? And everyone will pay more, because they need more money.

Council tax is very unprogressive - people with houses (or land) worth 10x as much as the average don’t pay 10x the council tax. They might pay 2x. So under any kind of proportional property tax/land value tax yes people with expensive houses would probably pay far more.

It’s very common in the US. It’s a state or city-level tax rather than federal, but paying 1% of your property value every year is common. In some states it can be up to about 3% a year. I think a lot of British people would get a shock if they were asked to pay 1% of their house value per year in council tax. But also, some people would see a tax cut as a result.

People in London with expensive houses but low incomes would probably have to sell or remortgage.

It’s not clear how you deal with renters. A council flat in inner London could conceivably be worth £500k, but lived in by somebody with an income of £15k. So you can’t charge the tax to the renter, at least for social housing. But then is it fair for social renters to effectively be exempt from local taxes?

It wouldn't work all that well in many towns and villages where little 2-bed terraced cottages have big long gardens and brand new 4-bed executive homes sit on a postage stamp.

And how would you value individual properties in blocks of flats?

I’m in the UK and my council tax is around 1% of my property value.

The value would be on the property, not the building on it. The property is the building and garden combined.

You'd value the flats individually in exactly the same way an estate agent does, when they are marketed for sale.

I read that it would be payable by the owner so renters wouldn’t pay (well rents will go up to cover obviously…). Council services aren’t then being paid for by the user which could lead to problems with bin usage etc etc

someone with a small place in London could pay as much as someone with a mansion in Yorkshire?

Why would a person pay more council tax just because their land/house is worth more? (Genuine question)

This would be a national tax - some paid to local councils and the rest kept by central government.

bet the councils would still struggle….

My Council tax is also about 1% of my property value as I live in a cheap area

I'd love too see CT reform, or a revaluation of higher band houses. the more expensive properties, worth many times what poorer families rent or own, pay proportionately far less.

We could charge the wealthier more, the less well off, less.

The current system is very unfair.

Someone who is asset rich but little money, can always downsize.... after all, we always telling the less well off to cut back/don't have kids you cannot afford... aren't we?

Anyway, rest easy, its already been ruled out by the Govt.

Most council taxes valuations are from years back. Lots of people around here have modified their houses and massively increased the value but aren’t paying more council tax. We need new valuations ( every few years) and new higher council tax bands imo.

Surely a land value tax would be based on the value of a parcel of land regardless of the buildings that are placed on top of it. So the size of your plot and where it’s located. So I agree with @slightlydistrac about the principal. How would they go about measuring the value of all of the land in the UK though? What about exceptions for farmland? What about land that has corporate buildings built on it? I can’t see how you could charge somebody living in a property on top of the land, only the owner of the land itself.

And how does it work in somewhere like London? A plot of land could have a 1930s house on it but could possibly fit a block of flats on it - so do you value it based on the maximum potential value? Do you take into account conservation areas and listed buildings?

i think it would take years to implement tbh

they’d be better off adding a % or 2 to corporation tax

Council tax being based on property values decades ago is nonsense really. Our house is Band A... its a 3 bed semi with a largish garden. All because of how little it was worth in the 90s (its about 200k now, so cheaper end of housing but not that cheap!)

Isn't this just the rating system that the UK had before council tax? Ie, if you own a house you pay rates, if you don't, you don't. The rates are set according to the market value of the property.

We still have it in NZ and it works fine. No problems collecting it either because defaulters can have a charge slapped against the title of their house.

It’s from this https://niesr.ac.uk/publications/uk-economic-outlook-chancellors-trilemma?type=uk-economic-outlook probably. There was an interview earlier with someone from NIESR. Not a government policy announcement.

but you need to be a subscriber to download the full report it which it presumably gets covered in some level of further detail.

Do you not think we pay enough taxes already.

our council tax has gone up 5% and the tax allowance threshold hasn’t risen.

agree about living in the SE as land is so expensive

and if stuff was valued in the 90s so be it

Also why should someone be forced to downsize? Or relocate away from their family/connections?

and in London a not very big property would probably attract the same tax as a significantly larger property elsewhere.

eta maybe the housing market is too distorted for a nationwide rate

Just saw something about this in the news. Concerned about potential impact on home owners in London who may not necessarily be wealthy - ie no other assets to sell and not a huge income.

I have older family who fall into this category but they could easily downsize from their large expensive homes...

I'd be interested to know this too, surely council tax bands are already based on the value of the home

the values are very outdated

Well we lived through 14 years of the Tory’s slashing budgets for councils so council tax has stayed lowish. The Labour government want to give us more police officers, youth services, children's services etc etc- sure start centres and youth clubs have been announced. So council tax will have to rise to pay for all of that. I’m ok with that.