The Times this week published my letter about the need for taxing values of land. It followed their article on the Crown Estate raising rent charges from £1 to £3 per megawatt hour for electricity from windfarms. As you cannot easily move a windfarm from one expensive landlord to another cheaper one, the Crown Estate are probably going to win. Note, with gruesome clarity, the power of landlords.
Another article today (31 Oct) shows the pain from another turn in the screw of this recession. Surveyors and valuers are being sued for inaccurate valuations given on properties during the boom times a few years back. Lenders relied on those valuations and willing doled out funds based on them. If the buyer defaults, lenders want their money back but the dropped house price is unlikely to cover the loan. Oh dear. So who should cover the loss? The valuers are the obvious target.
Here is another case for land value tax. Such a tax would be based on official valuations lodged with the Land Registry. It is the land value that is the volatile part of the property price, the building's value is a much steadier entity and easier to assess. Official land valuing in all planning categories for taxation purposes would help prevent such disputes as there would be accessible up-to-date indexing of historical valuations for lenders to check against before the purchase. But, whatever such litigation was prevented, the overwhelming case for land value tax is to use community-inspired land values as a base for funding public needs rather than taxes on income and goods.
PS. Click here for a short video interview with the landlord of 900 houses in Kent. Nice one!