Land Value Taxation Campaign

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Home FAQ How can I avoid LVT?

How can I avoid LVT?

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I work away from home all the time and basically live out of a hotel all week. I only use my house at the weekend (which is for sale anyway). When I sell, I'm considering staying in hotels permanently.

So under LVT would I effectively be paying no tax?


Would my hotel bill go up massively instead? What kind of affect would that have on tourism/business.

But actually if I read this right, hotels prices wouldn't go up. They may pay more for their land, but won't be paying tax on anything else. The tax they pay might be the same so they don't need to change their pricing.


So, I would indeed be paying no tax. Great, I will be awash with money.


This question is coming up in various guises at the moment. Under an LVT system, the only way to avoid the tax is to divest oneself of assets that actually consist, all or in part, of land, and to avoid using any land.

One could avoid paying LVT by living in the street in a cardboard box, or by taking to the high seas and never putting in to port, in a Flying Dutchman ghost ship scenario. But what about living in a hotel?

Because hotels are labour-intensive, a hefty chunk of the cost of staying in one consists of tax, since, one way or another, it ends up in the government's coffers. If these taxes were reduced or abolished, hotels could cut their prices; hotels in unattractive locations could charge little more than the cost of providing the service. Elsewhere they would be able to charge more, and this surplus represents the locational advantage, in other words, the land value.

If one chose to live in a hotel in, say, West Hartlepool, one might end up paying little in the way of LVT, but who would want to do that?

LVT is not a cost, because rent is a residual surplus after all other costs are paid, and LVT is a share of that surplus. Rent is mistakenly regarded as a cost due to faulty accounting techniques. 

 

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