Link: ConservativeHome’s Platform: Mark Wadsworth: Time to look at Land Value Tax?. I commend this discussion to your attention!

Mark writes,

The total value of all privately-owned residential property is currently around £4,000 billion, of which three-sevenths relates purely to land/location values, i.e. £1,700 billion. If and when house prices fall to their long run average of five times disposable household income, then land/location values will fall by two-thirds to £570 billion.

This would be exactly the right time to introduce LVT - the fiscally neutral rate required to replace all existing taxes on residential property in their entirety (see list above) would be about 6% per annum on site-only land/location values. The tax would act like an extra interest rate, so in future, price rises would be dampened and values/prices would be kept low and stable. There would be no windfall gains to land- and home-owners, but just as importantly, there would be no risk of land- and home-owners suffering ‘windfall losses’ – what doesn’t go up can’t come down.

And I particularly appreciate his disclaimer:

10. Disclaimer

I have made a small fortune in property over the last ten years precisely because the government did not have the moral courage to introduce LVT back in 1997. Unless the next government has the nerve to follow my advice, I have every intention of making a large fortune over the next cycle, so from a personal point of view, LVT would deprive me of a large pile of money.