Panel of Speakers:
Sir Sam Brittan, Financial Times
Fred Harrison*, Land Research Trust
Prof. Iain McLean, Professor of Politics– Oxford University
Ashley Seager, The Guardian
Molly Scott Cato, Green Party Economics speaker
David Triggs, Henry George Foundation
* Author of Boom Bust: House Prices, Banking and the Depression of 2010.
There was standing room only in Committee Room 5 at the House of Commons on Tuesday evening for a lively and stimulating seminar hosted by Vince Cable. The Coalition for Economic Justice – a recently formed grouping of concerned organisations across and beyond the political spectrum– believes that the private appropriation of community-created site values is lethal in its effect on our economic arrangements, dooming every economic upswing to an ultimate collapse. To end this cycle of boom and bust it is vital that the Government has some control over the level of property prices. Land value taxation would give it that control.
The House of Commons seminar held last Tuesday was aimed at parliamentarians and policymakers. It examined the advantages of land value taxation, how it might be introduced and how transitional problems could be dealt with.
As Sir Sam Brittan saw it, the case for LVT was clear and simple. But perversely, people find this difficult to grasp; they expect complexity in taxes. Being a tax on unearned value increment, LVT was no disincentive to Labour or Capital. As a temporary expedient, pending the full introduction of LVT, he advocated the auctioning of planning permissions.
Ashley Seager of The Guardian cited instances where public expenditure had led to massive increases in property (i.e., land) prices. In one case, the building of a school had led to such a big increase in local property prices that teachers in the school could not afford to live in the area. As the land of this country is provided free of charge by nature, “rising property prices do not raise national wealth one single penny”. They serve no useful economic purpose and are an obvious target for taxation.
Professor Iain McLean explained how, as a member of the independent expert group set up by the Calman Commission, he was looking at LVT as a way of financing public services in Scotland and Wales. LVT would replace council tax, business rates and stamp duty.
From a Green perspective (Molly Scott Cato), land is a trust for the people, its life-giving properties to be preserved from one generation to the next. LVT, which aims to curb private profiteering from the nation’s patrimony, was seen as a valuable tool in this connection.
The groundwork for the panel discussions was set out by David Triggs in his opening address. “The challenge that confronts those interested in establishing a just and equitable division of the fruits of production lies essentially in recognising that land values impound that part of the value created which is attributable to factors external to the individual, e.g., the country’s infrastructure, the system of governance, law and order and the density of population. It is manifestly unfair to tax the individual on what he produces while those community-created values are provided tax-free to the benefit of the landowner. These land values, arising essentially from location, should be the primary source of taxation.”
Fred Harrison reinforced this message. He showed how failure to collect location value led to diminished opportunity and life expectancy at the marginal location.
James Black (a sixth-former) said LVT made common sense to the young and the opportunity should not be missed.
This seminar is the first step in a campaign to interest parliamentarians in the formation of an all party parliamentary group on Land Value Taxation.
Organisations involved in the CEJ include:
Christian Council for Monetary Justice (CCMJ), Global Justice Movement (GJM), Henry George Foundation (HGF), Land is Free (LF), Land Value Taxation Campaign (LVTC), Labour Land Campaign (LLC), Liberal Democrat Action for Land Taxation and Economic Reform (ALTER), Professional Land Reform Group (PLRG), School of Economic Science (SES), Social Liberalist Party (SLP), Systemic Fiscal Reform Group (SFRG), The 1909 Group