LVT - a really bad idea?

[usernamealreadytaken]

The New Poll Tax - from the Labour Manifesto

"We will initiate a review into reforming council tax and business rates and consider new options such as a land value tax, to ensure local government has sustainable funding for the long term."

The suggestion is that the LVT would be around 3%pa. That gives a very real possibility of some in the South East being liable for bills of in excess of £9000-£15000 per year or more, for living in fairly modest homes. That's pretty much a NMW worker's entire salary in LVT. I also read that pensioners would be exempt. Given that a great number of those with large houses and gardens are likely to be pensioners, isn't this really just a tax on ordinary people who can least afford it?

Just a thought; given that you can put a block of flats on a plot that could accommodate far fewer houses, won't there be the potential for urban local authorities to lose considerably under this formula, even taking account of any empty plots that will attract taxes they don't currently? In a well developed residential areas with little unused land, if flats are the norm (some areas in London particularly), the local authority could well see a reduction in revenue. It might also encourage developers to squeeze the maximum number of properties on to land in order to maximise profit whilst minimising LVT liability (if land value is based on size undeveloped).

So many potential drawbacks. That said, it's not necessarily a bad idea in principle, but there could be huge losers and as always they will be ordinary families rather than developers who will find a way to either pass on costs or avoid tax in another way.

So, if this new LVT does end up being implemented, and as suggested landlords, not tenants, will be liable, how will those renting their homes be contributing to the local services they access? Up thread it was suggested that landlords would pass on the cost to the tenant, but then subsequently offset this against their tax bill.

It doesn't seem fair (and I know no one ever said life would be fair) that someone who uses very few local public services, e.g. no children, no street lighting (rural) etc, but owns a few agricultural acres could pay thousands in local tax a year, whilst someone who rents contributes nothing.

Agricultural land is currently treated differently. At the moment we shovel money into the pockets of landowners in subsidies rather than taking it out

If you started changing at the rate of "thousands for a few acres" there would be so much money coming in that the deficit would be paid off in the twinkling of an eye.

Is that what you're going to propose during the consultation? It certainly isn't suggested in the manifesto.

Great idea piglet, then all those non profitable farms that give us insects, small mammals and AIT can be built over once the owners cannot afford the taxes. The badger cull and fox hunting debates will also be shut down, as there'll be nowhere left for them to live

The value of the land is based on what the land can be used for. Agricultural land without planning permission for housing would be valued as such. There would be pressure ti use the agricultural land most profitably for agricultural purposes, but not for building.

There is a lot of wilful ignorance and inability to do the most basic of research on this thread. I wonder why

username

the suggestion is yours.

It's not my suggestion, and it's not in the manifesto.

For some reason you are choosing to paint a gloomy picture of your own devising.

You're right, I am painting a gloomy picture. It's what people do around political stuff - "bedroom tax", "dementia tax", "garden tax". Two of these don't exist yet but we're all experts already. I know which one scares me more.

So you'd agree that if the dementia tax was capped at half a million per person, and if many homes are owned by couples, and if the proportion of old people suffering from dementia stabilises at 60%, within a generation, inheritance will have dried up for all but the very rich.

I think it's scandalous that you don't think a couple with assets of a million pounds is very rich. I also think it will lead to an awful lot of money leaving the country, unfortunately. Although DH and I work hard and would love to leave something to our DCs to help them in a way we never were, at the end of the day if we need to pay somebody to look after us in our dotage then I think that's a very good use of our money. However, I also feel that everybody who is able to should be asked to contribute to their care, whether that is by way of deduction at source from income or some kind of compulsory medical cover such as they have in France.

However, I also feel that everybody who is able to should be asked to contribute to their care, whether that is by way of deduction at source from income or some kind of compulsory medical cover such as they have in France

Or even something like income tax, or NI?

user

"you don't think..."

your imagination is leading you astray again.

So we bought twenty years back, have improved our home instead of moving and have flogged to pay off as much of the mortgage as we can which has a few years left to run. Neither one of us have seen a pay increase for over four years and dh earns less now than in 2007. Every year the bills go up and we pay VAT on increased spending, from food to clothes to utilities. Surely Corbyn cannot think that taxing us based on a decision we made 20 years ago before land prices increased and the area became desirable, is something that is going to benefit folk like us?

What makes you think that the average person in the average house will be charged more after a review of the Council Tax system?

Only the Daily Telegraph has a crystal ball to see into the future.

What was the one line at the bottom of their imaginative article?

Okay noone knows what the % of thresholds will be like however Corbyn has said he will be reducing the inhertiance tax threshold back to £600k or thereabouts whereas now it is £1m.

Not surprised people have little faith about the thresholds of %'s being high enough [hmmm]

People complain about the TM social care policy and not being able to pass on their houses to their children because it wil lbe used to pay for their care, yet happy for Corbyn to lower the inheritance tax threshold and take the money to pay for others.
So your happy to hand over money in the form of a tax but not to pay for your care?

At the very least TM policy raises the existing threshold to £100k from £23k.

Where did you get those numbers from?