We have been warned

Saturday, 28 August 2010 06:31
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Yesterday's Guardian carried an article promoting LVT, written by prospective Labour leader Andy Burnham. It completely failed to anticipate the barrage of flak that was going to be thrown up. The responses should be a warning to all of us campaigning for LVT. We need to present the case better, which means that we all needs to understand it and be able to defend it against the kind of absurd criticisms that came up in yesterday's Comment is Free. His piece was almost torn to shreds by the objectors.

Much of the opposition comes from people who have completely failed to grasp the implications. There are also real objections to be addressed, which must be openly discussed whenever the policy is mentioned.

Yesterday's trailing of LVT, therefore, threw up all the pitfalls an LVT advocate can slip into. The objections raised were
There has to be a convincing plan to deal with the fact that some pensioners could experience hardship. A roll-up or general increase in pensions are the most likely solutions. These have to be worked out and costed.

The other objections are absurd, but only if the tax is levied on a basis of the selling price of land and not its annual rental value. This is apparently a technical matter but fundamental to the entire justice and viability of this tax reform. LVT is not a tax on wealth, nor a tax on what a plot of land could be sold for. It is a tax on what is usually an actual revenue stream or else on an imputed revenue stream.

It is also essential to point out that the tax is a replacement tax, initially, probably, for Council Tax and UBR, but within a short time for taxes on wages and jobs, which would best be done by  raising tax thresholds, or better still, NI thresholds.

From that point it is not difficult to demonstrate that it will lead to reduced unemployment, attack the problem of poverty traps and cut the government's welfare bill. All of these mean that, first, a coherent introduction plan needs to be produced, if only in outline, and that we all need to understand the implications so that we can present LVT convincingly to politicians, civil servants and the public.

Promoting a major political change such as LVT is not a game or a hobby. Anyone who is not able and willing to grasp the theory and detail would do better to cheer from the sidelines than try to campaign actively.

We have been warned.
 

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