Land Value Taxation Campaign

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How should we be campaigning?

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Most LVT campaigners are at some time tempted to believe that the reform we support is only just over the horizon. One more push, and we shall be there. The temptation seems to hit hardest at two points. The first is when we have “seen the cat”. Having spotted the elusive feline lurking in the branches, we find it difficult to appreciate that anyone else could miss seeing it. The other time the temptation kicks in is when we are getting on a bit and want to see a result for our efforts: LVT before we retire, or are kicking up the daisies.

This is to ignore two important facts. The first is that we are all rent-seekers. We all pick the best places in restaurants, theatres, on the beach, when travelling, pitching a tent for the night. Some of us are so successful at rent-seeking that we would rather not see the cat, and the mind being a wonderful thing, it makes sure that the cat is unseen. The second fact is that the most successful rent-seekers of all have been able to pass on the fruits of their success down the generations and have so much power and influence that they are able to stifle any serious discussion about cats. This is usually done by steering the discussion in another direction, or by gentle ridicule.

What does this mean in practice, in the British context? None of the main parties have LVT on the agenda. There was a little bit of interest in the higher ranks of the Liberal Democrats in the last years of the Labour government but this has long since evaporated. Unless events take a very unexpected turn, there is no prospect of LVT within the present decade and quite possibly beyond. Labour might have gained some electoral advantage from it, but the politicians are more concerned with power than principles and their attention is on the “swing” voters in critical constituencies, who are the very sort of people who might be influenced by media scaremongering if it was in the party’s manifesto.

Thus, in the absence of political will on the part of those who make the decisions, there is no point is devoting time and energy to working up detailed plans for the introduction of LVT and trying to predict how different groups might be affected. Circumstances will be different when the time for LVT approaches. We need to focus now on principles and strategy.

As a matter of practical convenience, any introduction of LVT would use the administrative mechanisms already in place for assessing and collecting recurring property taxes. Logically, and to avoid two different systems of property tax running side-by-side, these existing property taxes would be the first to go, and there would be little further change until the system had “bedded-in”. There is a particular difficulty within the present UK context because the residential property tax, the Council Tax, is a local tax, and for reasons discussed elsewhere on this web site (http://www.landvaluetax.org/frequently-asked-questions/lvt-national-or-local.html), we are firmly against the use of LVT as a local tax. This raises the questions of transition and the financing of local government, which are also discussed in the linked article.

After that crucial first step, there is an extensive range of options for the phasing out of other taxes. It cannot be assumed that the tax system will exist in anything like its present form into the indefinite future. As a matter of general principle, in the early stages of LVT, we would like to see a sharp cut in sales taxes. But there is also an urgent need to reduce taxes on work, in particular, by removing the low-paid from tax liabilities.

There is also a need to discredit existing tax systems by drawing attention to their stupidity, illogicality and running costs, the ease with which they are avoided and evaded, and to the economic damage they do. The ramifications here are considerable, especially when the “tax incidence” arguments are deployed, since it can be shown that amongst the harmful effects are less obvious problems such as regional imbalance and a chronic shortage of funds for infrastructure.

Discrediting the tax system and the economic arguments that are wheeled out to support it can be compared to pouring acid on a concrete bunker. It is not going to crumble to the ground straight away, but every little drop helps to weaken the structure and the concrete has its own inherent weaknesses. Since de-bunking is also an activity which can be enjoyable, we need to take a relaxed view whilst keeping going.
 

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