Monday, May 2, 2011

Getting the message across, Mark ;-)

Tax property, not people, for a fairer society

Mark Wadsworth is an economist, blogger, sometime Tory Bow Group adviser and campaigner for land value taxes. He recently told Economic Voice website: "I'm an economist not a politician, and I can only repeat what all the great economists have said down the centuries: taxes on land values are the least bad taxes because they do not depress or distort economic activity, ie wealth creation. Land value tax is easy to assess, cheap to collect and impossible to evade.

Posted by happy mondays @ 08:46 AM (4244 views)
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118 thoughts on “Getting the message across, Mark ;-)

  • I really don’t know about the Wadsworth guy. He clearly has a vested interest.

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  • mark wadsworth says:

    Yes I have a vested interest, I have kids who will one day grow up and will be looking for work and somewhere to live.

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  • magnifico says:

    He’s “an economist not a politician”. Doesn’t being Treasurer of UKIP conflict with this?
    I really don’t know about him too Paul. I find his posts, though logical and well presented, somehow annoying.

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  • Two birds with one stone in this article – well done Mark and The Captain gets an honourable mention with his Economic Voice.

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  • I was joking, magnifico.

    Don’t take yourself so seriously either mark – there are others who can do that now!

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  • letthemfall says:

    I thought mark w was a tax adviser!

    LVT would begin to unwind the power structures that date back over 1000 years, which is why I don’t expect to see it in my lifetime.

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  • mark wadsworth says:

    M, I was indeed Treasurer of UKIP for a couple of years, it’s a completely non-political part-time job that involves a lot of form filling, book keeping and correspondence with The Authorities, i.e. it wasn’t much different to my day job (which is exactly what LTF says it is). And I apologise for being annoying, but I’m just an annoying sort of person, I can’t help it.

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  • Well done MW, your message may be getting through at a snails pace.

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  • the number cruncher says:

    A hearty cheer for MW – well done

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  • I’m so tempted to be rude about this piece – but I’l let Mark have his 15 mins of fame…

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  • Unfortunately I have to agree with letthemfall. LVT is a nice idea but will never be implemented even though anyone sane should know it is a good idea.

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  • the number cruncher says:

    Georgism is more ‘right’ than any other ‘ism’ I have discovered and any thinking person, once it is understood would agree.

    I am sure many people once said slavery could never be abolished or that women would never get the vote.

    A little less defeatism, if you know its its the best policy you should say and keep saying so.

    Keep up the good work MW and don’t let the naysayers put you down.

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  • 7. mark wadsworth

    What do you think your chances are of taking on the royal family of imposters?

    Le Crunch question.

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  • 12. the number cruncher said…I am sure many people once said slavery could never be abolished or that women would never get the vote.

    ROTFLMAO.

    I’m sorry NC, but that has to be the funniest thing I have read this year, with all due respect.

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  • need-a-crash says:

    Well said number cruncher, one day we’ll have our revolution and perhaps it’s closer than we think. A shake-up of our political system of which a ‘yes’ to AV can be a small start, could be the beginning of greater things.

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  • the number cruncher says:

    I always found that MW’s most annoying tendency is he nails his colours to the mast and is often right to boot. Its a nasty habit I hope to emulate one day.

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  • need-a-crash said…Well said number cruncher, one day we’ll have our revolution and perhaps it’s closer than we think. A shake-up of our political system of which a ‘yes’ to AV can be a small start, could be the beginning of greater things.

    ~ Dream on!

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  • mark wadsworth says:

    House, TNC, thanks, I just do my bit the same as you.

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  • greenmind says:

    And if we get a “no” to AV (which looks most likely at this stage)?
    Nevertheless keep battling for good ideas, its the only sane thing to do.

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  • uncle tom says:

    Aside from the obvious stumbling blocks – that LVT is probably unconstitutional, would have to be enacted by politicians who would mostly find themselves among the net losers; and that the history of radical tax reform shows it to be politically suicidal – I’d like the proponents of LVT to explain how they would square the following obvious issues:

    1) Couple (a) are both working, have no children, and for that reason have no need of a large home. Couple (b) have children, only a single income while the other takes care of the family; and because they have children, need a larger family home.

    Clearly, couple (a) are much better off than couple (b); but under LVT, couple (a)’s tax burden would be reduced while couple (b) would have to pay more. That is manifestly unjust.

    2) A couple (or single person) has planned their retirement prudently and responsibly. Having paid off their mortgage, weaned the kids and downsized to a home of modest proportions, they have just enough income from their pension arrangements to get them by. They consequently pay very little tax at present.

    Suddenly they are confronted with a new tax demand, based on the value of their home; which they had neither anticipated nor budgetted for. Again, manifestly unjust.

    – So, how do you stop LVT from being seen as a tax on families and a tax on pensioners?

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  • the number cruncher says:

    There has been a heavy effort to discredit AV with the tried and tested fear message, just as there was with LVT where it has been tried around the world. AV may be a “miserable compromise” but its the only one we can vote on. I think the NO camp have overplayed their hand and it may be closer than they think.

    According to Bob Worcester, MORI chairman, its all about who can mobilise enough well known decision makers to support their cause and this is more about Nick Glegg’s popularity. Bob, is just one of a number of prominent public figures who have in the past called for me to be sacked from my job. I bumped into him a few weeks ago at a lecture and he continues to be a miserable SOB.

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  • UT – any tax can have exemptions for cases where the tax would not be equitable. See the site of the New South Wales Office of State Revenue http://www.osr.nsw.gov.au/taxes/land/ – their simple solution is to exempt principle places of residence:

    “Land tax is a tax levied on the owners of land in NSW as at midnight on 31 December of each year. In general, your principal place of residence (your home) or land used for primary production (a farm) is exempt from land tax. You may be liable for land tax if you own or part-own:

    vacant land, including vacant rural land

    land where a house, residential unit or flat has been built

    a holiday home

    investment properties

    company title units

    residential, commercial or industrial units, including car spaces

    commercial properties, including factories, shops and warehouses

    land leased from state or local government”

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  • er, “principal” second line

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  • uncle tom says:

    “any tax can have exemptions for cases where the tax would not be equitable”

    So the notions that it would be “easy to assess, cheap to collect and impossible to evade” – all fall at the first hurdle…

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  • Not in the case of NSW.

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  • letthemfall says:

    UT
    I don’t see how LVT can be unconstitutional when we don’t have a constitution. That use of the word sounds like “unamerican”, with the same connotations.

    Icarus
    I wonder how many aristos would claim exemption for all their estate – my principal residence’s back garden don’t you know.

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  • Everytime I look at LVT I am left with the conclusion that the advertised purity and simplicity of LVT is sadly unobtainable. There would have to be so many exemptions (as per uncle tom) to avoid injustice that we would actually be left with a somewhat complicated tax. Apart from uncle toms list, there are also such matters as LVT penalising large factories that own their own land. They would continue to pay large amounts of tax even when they are operating at a loss in a recession or when they are operating at loss because of a huge investment. A company like Honda would not tolerate such unjust treatment and they would fly into the arms of a more welcoming country….or would there also have to be some sort of large exemptions on taxing land? LVT is too complicated. We can achieve the admirable aims of LVT with a much more simple tax regime

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  • uncle tom says:

    “when we don’t have a constitution”

    Actually we do, but it has never been officially compiled into a single document.

    One of the foundations of the British constitution is the Magna Carta, which (amongst other things) prevents the crown from taking the property of the people without compensation. The taxation of wealth is therefore unconstitutional.

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  • mark wadsworth says:

    Uncle Tom, we’ve already answered those questions and in any event, how is that worse than under current rules? Your two earner no kids couple can afford a larger house, your single earner with kids couple probably couldn’t afford a large house at current prices anyway. And don’t forget the Citizen’s Income element in all this.

    You’ve just played the Poor Widow Bogey again, we’ve done that to death. I am sure that you can imagine a system whereby pensioners’ main residences are exempt, that is mathematically do-able, yes? So what if we subject their homes to a very modest LVT (let’s say average £1,000 each), pay all that money into a separate pot and dish it out as an extra £1,000 a year Citizen’s Pension? What we’d have is pensioners in large houses subsidising the pensions of your modest and prudent couple – they’d be BETTER OFF under LVT/CI.

    And why stop there? Why not collect the full LVT from pensioners (say about £12,000 per home, on average) and dish it out as an extra £8,000 Citizen’s Pension a year? That way two-thirds of pensioner households would end up BETTER OFF.

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  • mark wadsworth says:

    Flash, the idea that replacing all taxes with LVT would somehow be bad for business is a pure and utter myth.

    My magic fag packet tells me that the LVT on business premises would be roughly double what Business Rates are now (so that annual bill goes up from £23 billion to £46 billion), but all the other taxes paid by businesses (VAT, PAYE, corporation tax) of over £300 billion would disappear. Are you seriously telling me that giving businesses a £300 billion tax cut is going to put them out of business?

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  • uncle tom says:

    Mark, you’re flogging a dead horse here..

    – The answer to affordability of property is not to play games with the tax system, but to build the nation into one thart has a modest excess of property instead of a modest shortage.

    – So you make pensioners’ primary residence exempt – and hey presto! every granny officially takes up residence with her relatives, and we get a nation of tax evaders – brilliant!

    You peddle the idea that it would make the whole tax system simpler and fairer, but its patently obvious that it would need so many special case exemptions and rules, that hardly anyone would understand it; it would cost a fortune to administer, and tax avoidance experts woud have a field day finding ways to exploit the exemptions.

    The whole idea is a complete non-starter.

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  • 10. uncle tom said…”I’m so tempted to be rude about this piece – but I’l let Mark have his 15 mins of fame.”..

    ~ LOL

    Carry on with the hornet nest kicking MW, at least it shows what the system is really built upon.

    “First they ignore you, then they laugh at you, then they fight you, then you win.”

    ~ Mahatma Gandhi.

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  • urbanbear says:

    @23
    The Fabians want you to believe that we don’t have a constitution so that they can have their wicked way with us, with their long term plan of attrition, like slowly cooking us in a pan of initially cold water.

    The Lawful Rebellion and Freeman movements are challenging the subversion of our constitution, especially in legal matters, including fraudulent courts of law, and abusive of power by the police.

    We do have several documents, including the Magna Carta and the Bill of Rights, from before and during parliament, which as a whole form a constitution, however any constitutional changes made after 1910 are potentially unlawful, thus void, because the Royal Prerogative was presumed, rather than given; this is unlawful because all constitutional changes require the monarchs consent, despite what the Fabians said to deceive the new Monarch of 1911 and his descendants. So I doubt the Socialists will respect much of the UK constitution just as the US state has little respect for the US constitution.

    @27
    How is a person or business going to afford to pay this tax when it takes no account of how much money they have made from the use of the land, given this can vary dramatically? Saying they can just sell up and move to cheaper land is a poor excuse and often not practical.
    Isn’t this just rent then, to a bigger land owner called the state, and even less fair than a consumption tax?
    Who actually owns the land? Do property rights even matter to you?
    How is it fair that someone who has contributed nothing to acquiring and improving land then gets to benefit off of it via LVT? Is this not the ideology of envy and justified theft called Socialism?

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  • shipbuilder says:

    “You peddle the idea that it would make the whole tax system simpler and fairer, but its patently obvious that it would need so many special case exemptions and rules, that hardly anyone would understand it; it would cost a fortune to administer, and tax avoidance experts woud have a field day finding ways to exploit the exemptions.”

    Sorry UT, Mark’s explained LVT and answered questions a hundred times or more on this blog and elsewhere, so you’ll have to back up your statement to the contrary with at least equal evidence or explanation if it’s to hold any weight at all.

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  • shipbuilder says:

    Urbanbear, leave the ‘that sounds like socialism’ jibe to the likes of Sarah Palin, I’m sure you can do better.

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  • the number cruncher says:

    urbanbear at 29

    “How is a person or business going to afford to pay this tax when it takes no account of how much money they have made from the use of the land, given this can vary dramatically? Saying they can just sell up and move to cheaper land is a poor excuse and often not practical.”

    The business pays for the natural resources and land it uses – it can use less and pay less tax – think of LVT as compensation to the rest of the community for what a person or business withholds from others. Business would be much better off under LVT. As MW said the would be taxed less overall. It frees businesses to make more investments in jobs and production and stops the endless system whereby innovation and efficiently always end up as higher rents to landowners and monopolists of other natural resources.

    “Isn’t this just rent then, to a bigger land owner called the state, and even less fair than a consumption tax?”

    Yes it is just rent – but the rent is divided amongst all and not monopolised by individuals – who gave you the land? lets face it most landowners today inherited land taken from people by theft and violence and we are continuing the crimes of the last 1000 years by allowing this to happen.

    “Who actually owns the land? Do property rights even matter to you?”

    Yes property rights are very important – a landowner can still own their land and pass it from farther to son etc. and there is no change in their rights to occupy and use their land.

    “How is it fair that someone who has contributed nothing to acquiring and improving land then gets to benefit off of it via LVT”

    Its the unimproved value of the land so the landowner has no tax on the improvements they make and gets to keep all of that value of improvements.

    “Is this not the ideology of envy and justified theft called Socialism?”

    No LVT is a pure free market system. Its far better than the state stealing your labour or taking a cut of every transaction. The LVT system is far more of a free market system as it removes the monopolies of land and natural resources we have today that suck up the wealth created by the efficiency and drive of our free market system as rents. Rent always increases when it involves the access to a finite resource. And this is compounded by speculation on future increases. LVT would remove the speculative portion of land values and therefore business and entrepreneurs would be free to invest in the knowledge that speculators would not take away their earned profits through trying to acquire a monopolistic grip on available land and natural resources. The state by just charging the unimproved land rental value would not be part of speculative process.

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  • mark wadsworth says:

    UT, it’s much easier if we start off by looking at and agreeing on actual hard facts before drawing conclusions:

    “The answer to affordability of property is not to play games with the tax system, but to build the nation into one thart has a modest excess of property instead of a modest shortage.”

    We have absolutely plenty of homes in this country, more than enough to go round. The problem is that it is incredibly unevenly distributed, by luck or political cunning, some people end up with a four bed semi and a holiday home while some other young couple are forced to rent a flat; for every widow rattling around in ‘the family home’ (clearly it’s not the family home as the family have left or died) there’s a grandchild who can’t afford to get married, buy a house, settle down and have kids themselves.

    “- So you make pensioners’ primary residence exempt – and hey presto! every granny officially takes up residence with her relatives, and we get a nation of tax evaders – brilliant!”

    I was merely illustrating that it would work on a maths basis (how we enforce it is a separate issue) to just exempt all pensioners. And I think I then explained that it would be even better to tax pensioner homes at normal rates and to chuck all the money in a pot and pay it out as extra Citizen’s Pension. That way, wealthy pensioners in large or expensive houses are subsidising those who have downsized (or only live in a small flat to start with).

    “You peddle the idea that it would make the whole tax system simpler and fairer, but its patently obvious that it would need so many special case exemptions and rules, that hardly anyone would understand it; it would cost a fortune to administer, and tax avoidance experts woud have a field day finding ways to exploit the exemptions.”

    Well, I’m the tax expert here, and you can take my word for it that it would be a lot simpler and cheaper to administer than the current system and requires no loopholes or exemptions whatsoever. It’s the Home-Owner-ists who keep coming along with the sob-stories about who loses out, not me.

    Remember: income tax etc. is hideously complicated and full of traps and loopholes (same with VAT or corporation tax or anything else). That is not an argument against income tax in principle, that is an argument against complicated tax systems.

    “tax avoidance experts woud have a field day finding ways to exploit the exemptions.”

    Which is why it’s better to have no exemptions at all. I hope you realise that there are very few exemptions for Business Rates and the collection rates are about 98%. There’s no reason for collection rates to be any lower for full-on LVT, it’s not like you can take land abroad.

    So the local council announces each year what the rate/sq yd is for that year and send you a tax bill showing rate, your plot size and asking whether you want to pay in monthly instalments or in one sum; whether you’d like it netted off with your family’s Citizen’s Income, have it deducted at source from your salary etc.

    “The whole idea is a complete non-starter.”

    Only because people go round saying it’s a non-starter.

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  • letthemfall says:

    UT: “Actually we do, but it has never been officially compiled into a single document.”

    Quite. The Magna Carta might be the closest thing we have to a written constitution but some of it has been repealed. Whether or not it contains a clause on removal of property, taxation of property is not the same thing.

    urbanbear
    Disregarding that I’m not really sure what you are saying, I’m inclined to presume you either own a lot of land, or you are hoping to. If neither, then it seems you have swallowed the hogwash that is frequently trotted out to defend the status quo, which I don’t need to elucidate as NC has done so above.

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  • mark wadsworth says:

    UB: “How is a person or business going to afford to pay this tax when it takes no account of how much money they have made from the use of the land, given this can vary dramatically? Saying they can just sell up and move to cheaper land is a poor excuse and often not practical.”

    Perhaps I should explain those numbers again. let’s take a typical business, which pays each year the following taxes:
    Business Rates £23,000
    VAT £90,000
    PAYE/NIC £180,000
    Corporation tax £30,000.

    (these figures based on total receipts, i.e. nationally, BR raises £23 bn, VAT £90 bn and so on).

    Are you seriously telling me that if Business Rates were doubled to £46,000 and ALL THE OTHER TAXES SCRAPPED that this typical business would go bankrupt? And no, LVT takes no account of how much an individual occupant makes from the land – it is based on what a normal user could make from that site. If really crappily run businesses can’t even afford the £46,000, then they go out of business. it’s called “creative destruction” and is an integral part of a capitalist economy.

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  • oh you poor deluded fools. Do you really think a property tax would REPLACE some other taxes, come on, wake up. while I have also been keenly awaiting the reduction in house prices, I am not so blinkered as to jump at this merely thinking about the effect on prices. This will simply go on top of the vast array of legalised thefts that we have to endure and as such it is a very bad idea.

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  • mw: I think you dodged the specific issue I raised of a large factory who owns their own land. LVT works where the large factory does not own the land on which their factory sits but it is not flexible enough to cater to a large factory that owns its own land (for the reasons I gave). People are getting way too waspish in defense of LVT. It is a well intentioned tax that can not achieve its claimed ‘simplicity’ tag. Why not just admit that it is not as pure and simple to operate as claimed and then move on to promoting it anyway? LVT is mostly a great idea but why wreck its’ credibility by making dodgy marketing claims?

    number cruncher: what if a business can not afford the £46,000 because it has just made a huge investment in technology? Still let it die?

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  • mark wadsworth says:

    Flash, if the business can’t afford to pay £46,000 LVT, instead of £23,000 Business Rates, how on earth would it be able to pay the £90,000 VAT, the £180,000 PAYE and the £30,000 corporation tax?

    The whole point of LVT (assuming you tax all land in any area at the same rate) is a massive reduction in taxes on businesses and a corresponding increase in taxes on residential land.

    I believe you run your own business – do you think you could survive if your business rates were doubled but you henceforth didn’t have to deduct PAYE or to pay VAT and corporation tax?

    Further, why would LVT discourage investment in technology? LVT is a sunk cost payable regardless of profits so there’s every incentive to making as much profit as possible (all tax free! yippee!) so there’d still be every incentive to invest in technology if that enables you to increase your profits (or indeed to run the business so efficiently that it requires less land, e.g. just-in-time delivery systems).

    By all means, slag me off for increasing taxes on residential land, but it’s a tad silly to then say that it would be an increase in taxes on businesses, when it would be precisely the opposite.

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  • There have been several well founded criticisms of LVT made in the above posts. Very few of them have been responded to and it seems to me that a blind faith system is being employed by our LVT disciples to gloss over its’ blatant flaws. It always makes me queasy when inconvenient information is discarded without due consideration,

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  • mark: Steady on old chap. I haven’t remotely slagged you off and you’re still dodging my very specific, factual criticism of one particular inadequacy of LVT. Your post seems to answer several phantom comments that I do not own or recognise.

    Let me make my position clear (again). I think LVT is mostly a great idea and I approve of nearly all of its aims. However the ‘simplicity’ tag is worthy of Barnum and Bailey. If it upsets you that someone only agrees with 80% of what you say, then you need to quickly check yourself in for a massage with extras

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  • the number cruncher says:

    Which criticisms have been ignored flashman? Try to be specific and I will try to answer them. What blatant flaws? – list them and be specific. If you are very specif I will give you very specific answers.

    The proponents of LVT have been far more specific than your gross simplifications of how businesses are taxed and straw man augment of attacking the imaginary failings of its proponents instead of the substance of the policy. It is a lot more simple, with or without exceptions, than the tortuous system of taxation we have at the moment. I also think it very hard to properly answer the incoherent ramblings of those over effected by rhetoric from our cousins across the pond in the Tea Party movement.

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  • Hats off to you MW.

    You have clearly done your homework on this and I know how infuriating that can be for some people.

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  • the number cruncher: I do not need any answers from you. Read throught the posts if you want to see what’s in them.

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  • 41. flashman said…the number cruncher: I do not need any answers from you. Read throught the posts if you want to see what’s in them.

    ~ Calm down dear, you can have the limelight another day throughty.

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  • Hi flash

    I’m having a mooch on here as the boy wonder Judd is making a balls up against the shifty Scotsman.

    I thought the ginger one had answered your reservation about large land owning businesses not being able to afford conventional taxes or LVT if running at a loss? Your scenario’s a bit like the Kobayashi Maru training scenario in Star Trek 2.

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  • mark wadsworth says:

    Flash: you said “You’re still dodging my very specific, factual criticism of one particular inadequacy of LVT.”

    I don’t think I am.

    I explained that a) the total tax bill on businesses as such would come down by about £300 billion and b) the total tax on residential land and buildings would go up by £300 billion (or make up your own numbers). Businesses would pay next to no tax – the only tax they would pay would be LVT which would be approx. double what Business Rates are currently.

    If you can give me a real life example of a business, and tell me how much they currently pay in PAYE, VAT, corporation tax and Business Rates, and how they would go bankrupt if their Business Rates bill doubled and all other taxes were scrapped then I would love to hear it.

    If the phase-in of the tax changes were announced in advance, then most of the few dozen businesses in the country which might (by some bizarre quirk of maths) be adversely affected would be able to rejig their business plans accordingly, and if they can’t, wel hey, that’s creative destruction for you. If an owner-occupier business can’t even make a profit with that incredibly low level of tax, then their consolation is they can make more by shutting up shop and renting out their premises to somebody else. Win-win!

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  • mark wadsworth says:

    Flash: “A company like Honda would not tolerate such unjust treatment and they would fly into the arms of a more welcoming country…”

    OK, let’s agree that Honda own their UK factory, and the only tax they had to pay in the UK were LVT, which would be less than half what they currently pay in VAT alone, or a tenth of what they currently pay in VAT + PAYE + corporation tax + Business Rates. If that sort of massive tax cut isn’t sufficient to keep them here, and to attract a whole load of new businesses, then I don’t know what is.

    And remember – the LVT is a sunk cost, it doesn’t affect decision making. The only way they can avoid paying is by shutting down the factory and selling the land – but the price they have to accept for the land is reduced by the future LVT bill, so they can’t sell the UK land and buy up French or German land for the same price.

    Seeing as they’ve got to pay the future LVT bill one way or another – either in cash in future, or by selling the land for a very low value – they might as well stay here.

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  • Hi alan: The scenario I described where a large (temporarily loss making) factory owns its own land is a long established criticism of LVT. The main LVT website gives a list of defenses against the standard criticisms of LVT. The best it can offer for this instance is that most factories do not own their own land so LVT still usually works. They of course have no answer for the situation where the land is owned by the factory. Taxing a business that is making a loss due to recession or large investment is never going to sit well and that is exactly what LVT would do to a loss making factory that owned its own land. Many years ago we made a big effort to get companies like Nissan and Honda manufacturing in the UK. If we heavily taxed someone like Nissan (who does own their own land) WHILE they were making a loss, they would bugger off pretty quickly.

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  • mark: I think you’ve obviously had that massage? See my comments at 45. Ownership of the Swindon land is muddy. The Sunderland factory land, on the other hand ,was definitively bought at agricultural acreage prices with the help of an enlightened local government (if only all building and factory land was sold at agricultural land prices). I deliberately kept my criticism defined, narrow and proven to avoid he more general pro and against arguments Taxing a loss will always go down like a lead balloon no matter what the circumstances or balancing arguments. If the factory doesn’t own their own land (most of them) then all is well with LVT

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  • I understand what you’re saying regards LVT but doesn’t the same apply to current taxation? – it doesn’t go away just because a company is making a loss. And if what Mark says is true then LVT may reduce the overall taxation burden on companies. His comment at 44 seems to answer this particular criticism. Anyway, off for a fag, looks like the boy Trump is about to go behind by 2 frames.

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  • alan: Most taxation (under the current system) does actually go away with a loss which is as it should be. Business rates, which don’t go away with a loss, have strangled thousands of fledgling businesses (do a google search and feel the hatred). Imagine starting up a business and not being able to invest in technology and production because you had to pay business rates. Imagine how a business owner feels who has to permanently shutter his business during a recession because business rates took precedence over staff wages.

    mw: Let’s leave the business rates bust up for another day!

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  • mark wadsworth says:

    Flash: “Taxing a loss will always go down like a lead balloon no matter what the circumstances or balancing arguments.”

    Yes, but talk to any insolvency expert and he will tell you that the two largest bills are VAT and PAYE (both of which have to be paid even though the business was making a loss) but there is usually no corporation tax bill – even though the right wingers always wail about corporation tax rather than other far more damaging taxes (corp tax raises only slightly more than Business Rates, half as much as EMployer’s NIC and a third as much as VAT).

    So yes, LVT would have to be paid whether you’re making a loss or a profit, but it’s the same as rent, that has to be paid whether you’re making a loss or a profit, and the good news is, for the 90% of UK businesses which make a profit each year and whose profits are steadily rising, the total rent + LVT bill would be fairly fixed. The really good businesses would do relatively better and the really cr*p businesses would be weeded out. As an ultra-capitalist, I don’t have a problem with that.

    “Business rates, which don’t go away with a loss, have strangled thousands of fledgling businesses (do a google search and feel the hatred).”

    Yes, I am perfectly aware of that, it’s like the irrational hatred towards Council Tax. But as a simple matter of fact (as was observed in the BR-free Enterprise Zones) and also of logic, if you scrap BR, all that happens is that landlords increase their rents to soak up the tax saving. So LVT + rent is just something that a business has to budget for, like the electricity bill or the wages bill, and it doesn’t actually increase the cost of doing business.

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  • MW said:

    “Well, I’m the tax expert here”

    Well, you may have a qualification in accountancy Mark, but I think you tend to lose the plot when it comes to real time UK..

    ..LVT is perhaps better known as ‘Loonies Volunteering Theories’ …

    ..it doesn’t bear close examination..

    ..it will never work..

    – And….

    – IT WILL NEVER HAPPEN!!

    So for f*ck’s sake mate – get a life, and get back to the subject of the housing market; where your thoughts do make some modicom of sense..!

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  • mw: I think we are now nearer to the same page, where we can agree that LVT is not perfect and that it is not entirely simple to operate. Having said that, nothing is perfect and things are very rarely simple in this world. I couldn’t have made it clearer that my objection is not against LVT itself. What I object to is the fanatical, one eyed marketing of LVT where many of its newly minted disciples (I certainly don’t include you in that) offer themselves up as human shields and wild eyed attack dogs despite not having any depth of understanding. I’m sure you already know that I discovered LVT decades ago (any middle aged economist or tax specialist can say the same).

    It goes without saying that I respect your depth of knowledge and I truly admire your determined support for an ideology that wants to peel back injustice . However it is a sad fact that marketing and presentation matter. If you want to successfully promote LVT then I would strongly suggest that you pragmatically admit the existence of its well known wrinkles and even more importantly lose the loons from the support group. You know I’m right.

    I have always liked LVT but the debates used to be saner with more give and take. I think that it has far more chance of being implemented if a large number of people think that it is mostly good and that it is slightly better than what we have now. It has no chance of ever being implemented if a tiny number of newly attached fanatics rub people up the wrong way by claiming that it was created by an immaculate conception and that it is without worldly sin

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  • Tamaradelem says:

    Well living in Switzerland, which has both a land value tax (calculated on imputed rent) and a wealth tax i would say it clearly does work, It allows lower corp taxes, lower income taxes, zirp IHT, ZIRP Cap Gains, 8% VAT and inflation tax isnt a planning objective

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  • mark wadsworth says:

    UT, I work in tax for a living. I see more sets of accounts of all manner of businesses than you do, and take it from me, they’d all do fine.

    Flash, ta, for sure there are “wrinkles”, i.e. lots of people hate the idea and think up marginal scenarios where supposedly innocent and deserving people lose out. I am perfectly aware of all that, so…

    a) We can keep it simple and accept that some people will downsize and others will trade up (which seems to be 90% of the supposed problem to me) and that across the UK, two or three marginal owner-occupier businesses would end up paying a few pence more (it would have to be a rare business indeed, one that pays neither VAT, nor PAYE, nor corporation tax) and there is a bit of “creative destruction” going on. This is my preferred option, once people have “right sized” that is the end of the matter, we are all sorted and can get on with our lives.

    b) Or we can invent lots of exemptions for chosen groups, which just means that ‘everybody else’ has to pay a bit more. Am I happy to pay ‘a bit more’ to keep Honda happy or to exempt UT’s brother in law who lives in a mansion? Not really, to be honest, but hey.

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  • Thanks mark.

    “Am I happy to pay ‘a bit more’ to keep Honda happy. Not really, to be honest, but hey”

    But you’d do it.

    It’s always hard to swallow exemptions for groups that end up (on the face of it) costing the rest of us a little bit more. However, I would swallow and take it in every available position to keep real production in this country. We’ve inadvisably smashed up so much of our industrial production that we are left in a vulnerable position. We now have no choice other than to do whatever it takes (within reason) to keep large overseas manufacturing corporations like Honda and Nissan in this country. Letting Nissan bugger off to an amazed but gleeful competitor would cost tens of thousands of jobs and hundreds of support businesses would go to the wall. Other international companies would consequently give us a wide birth and the critical mass of businesses that is necessary to attract other businesses would be irrevocably damaged (the City’s greatest fear). The lost wages would no longer multiply their way through the economy and it is a fair bet that it would end up costing us all more than the small LVT contribution that we saved by imperiously allowing Nissan et all to clear off for good. The tax that used to be paid by these businesses would also have to be deducted from our individual ‘savings’. There is also the small public relations matter of newly unemployed workers rioting against the policy that cost them their livelihoods and homes

    LVT’s ‘creative destruction” is one of those expressions that glosses over real lives being ruined. Thatcher used similar ideological phrases to justify her purges and radical alterations to our economy and tax systems. She once looked at her results and thought that the collateral damage inflicted by her ‘creative destruction’ was justifiable. Consequently, she is still hated by millions of people and hindsight is causing many of her most ardent supporters to be somewhat regretful.

    In a similar vein, urban planners once demolished entire communities to build new any shiny places for people to live. They also called it creative destruction but the beneficiaries call them sink estates. We now watch grainy footage of people proudly scrubbing the doorsteps and windows of the small Victorian terraces that made up the neighbourhoods that the planners generously demolished for the peoples own good

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  • mark wadsworth says:

    Flash, yes I accept that large corporations can to some extent hold governments to ransom, but on the facts, people like Honda would not leave a country which charged them no VAT, no employer’s NIC, no corporation tax and allowed them to pay employee’s their salaries gross. Assuming they want a base in Europe, where else are they going to go?

    I’ve looked this up and apparently, their site is 370 acres, they employs 5,000 people and they make 139,000 cars a year. Let’s assume that VAT, PAYE and corporation tax per car is £5,000 = total current tax bill = £695 million + approx £25 million Business Rates. That also works out at about £14,000 per employee/year, which looks ‘about right’.

    Using my pre-calculated approx. LVT rate for Swindon (long story) of about £30/sq yard/year, their LVT bill = £53 million/year.

    That looks like a ninety per cent tax cut to me, so yet again, I hotly dispute that Honda et al would leave the UK. Can you please give me a real life example of a business for whom the total tax bill would go up?
    —————————————————–
    As to ‘creative destruction’, let’s imagine I inherit a shop with a fixed LVT bill but I am rubbish at running a retail shop, so I end up only breaking even. Clearly, the best strategy for me is to let out the shop – by definition, the rent will always more than cover the LVT bill (that’s how we calculate it) and so I then end up with a nice little profit every year for no work whatsoever, and the new tenant will obviously be employing people and supplying goods and services which people want to buy. That looks like a win-win to me.
    —————————————————
    As to urban planning, that is an entirely separate debate. LVT encourages efficient use of land, is all I can say. Honda, for example, whose site appears to be at least 50% car parking spaces might decide to sell off part of the site and building a multi-storey car park instead, yippee, work for local construction industry and units freed up for other businesses to move to the area (the Honda remora) without a single square inch of The Hallowed Green Belt being “lost”.

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  • mark wadsworth says:

    Oops, ignore that £14,000 per employee figure, it’s £140,000, i.e. 28 cars per employee @ £5,000 per car.

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  • the number cruncher says:

    flashman

    the truth is normal business that add value such as Nissan would benefit from hugely from LVT whatever there status of ownership of land.

    The people who would not benefit are non-productive businesses that leach off productive businesses. Some banking , shadow banking and financial services companies would go bust as their business is the business of funding monopoly in land and natural resources.

    There will be creative destruction and huge construction as well. As a MD of an SME myself, the lifting of NIC and Income Tax, would allow me to employ a lot more people and put investment into my infrastructure. The benefits to real productive businesses would be enormous, all across the country business owners would be freed up to put more resources into jobs, training and development. Over the medium term our country would become much more competitive on the world stage and along with a reallocation of wealth from non-productive to productive we would increase our overall economic output.

    LVT would cause a lot of short term problems – I very much agree, the biggest being all the sons of landowners in the army wanting to plot a coup. Also those extremely wealthy people who rely on a almost zero tax environment for their wealth would want to flee the country. But these people do not produce real wealth and are just a drag on the real economy. Good riddance, I am sick of this country being held in a vice like grip of city monopolists which you are determined to defend.

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  • mark: I am not saying that LVT would cause the aggregate, averaged over time, tax bill to go up. It is after all, just a replacement tax.

    However, large manufacturers experience cycles. You will have noticed the latest stellar results from Chrysler, GM and Ford? For years they have been on life support, of one form or another but now their models are good and their global sales and profits are soaring. Their future appears very bright indeed and I just couldn’t imagine saying that a few years ago

    If (the IF is very important) these manufacturers owned the land that they worked on (and many of them do), then LVT would have continued to heavily tax them, when they were on life support. That makes absolutely no sense. If we don’t tax them when they are making a loss, then we will reap the tax benefits when they are profitable and we will end up with just as much tax contribution, averaged over time. However that’s being overly generous to LVT. Due to LVT not being sympathetic to cycles (IF a factory owns its own land), we would lose out long-term when we completely lost the business.

    Thatcher thought we should throw away businesses that were unprofitable. The French, Germans and Italians persevered and supported their loss makeing car factories and now crappy old Fiat owns 46% of a resurgent Chrysler and Renault more or less controls Nissan. I could weep when I think of how we threw away ownership of Rolls Royce, Bentley, Land Rover, MG, Aston Martin, Jaguar, Triumph, Rover, Mini, Wolsley, Riley, etc.

    Companies like Nissan have no particular allegiance to the UK. They are here because we competitively induced them to be here. If we heavily taxed them when they were making deep multi-year losses and fighting for survival, they would most certainly take a very dim view of the UK as a manufacturing base. They would go to another EU country to make their cars (as you know, they need the EU base to sell cars in the EU without duties etc)

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  • sibley's b'stard child says:

    Congrats MW and kudos to you; keep up the good work etc.

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  • mark: It looks like the adult portion of the debate is over, so see you next time

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  • capitalist says:

    How anyone can get so excited about one form of theft vs another is beyond me. If anyone think any taxes would be reduced when some new form of plunder is introduced they are kidding themselves in the extreme. Government is a one-way street – it only ever gets bigger. LVT would simply be one new steaming pile dumped on top of those of us who are already paying through the nose to keep politicians feeling good about themselves.

    As to the supposed economic benefits this new form of plunder is supposed to bring about, it’s all been argued before on this website and as far as I’m concerned it’s still all nonsense. There are distortions all over the economy caused by government and the primary ones by far are the monetary system and the welfare state. LVT is one gigantic yawn and a distraction from the real problems. But carry on and have at it if that what you want.

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  • the number cruncher says:

    Your clutching at straws flash! (or is that straw men) – now you loose a debate you want to take the ball away – Boo Hoo

    Cycles: LVT would reduce and buffer the effect of cycles – it is the best solution minimise the natural tendency to over speculation and contraction. Productive business would still pay less tax during a recession than they would under the present system

    IF they own land – as MW has repetitively pointed out very well it is immaterial.

    Thatcher’s folly – is not related to LVT at all and the augment is a non sequitur. LVT would help in investment in productive businesses, not take it away.

    Nissan – no they would not

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  • the number cruncher says:

    Capitalist, managed to read through progress and poverty yet?

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  • mark wadsworth says:

    Flash, however bad things might have been at Swindon, e.g. I believe they shut down for five months and just paid their workers their basic wages, I see absolutely no reason to believe that their total tax bill dropped anywhere near 90% to £53 million in a year.

    As I said, I accept that LVT would tax homes much more heavily, but a 90% tax cut on Honda is and remains a 90% tax cut on Honda. That is not heavy taxation, that is light taxation, that £53 million works out at £381 per car. And if Honda are then thinking about expanding production in Europe, that £53 million is a sunk cost – so if they increase to full capacity of 250,000 cars, the tax bill per car works out at £212 per car, there is nowhere in the world that will tax them more lightly than that.

    I mean, on the facts, a ninety per cent tax cut is a ninety per cent tax cut, so again, I’d be interested in an example of a real life business which would actually pay more under LVT.

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  • tnc: You’d first have to understand a debate to adjudicate a winner. You have recently improved your behaviour but this is a reversion. Army coup? Straw men? Oh dear

    mark: Do you see what I mean? What chance do you have now with the bingle-bongle brigade attaching themselves to your cause?

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  • mark wadsworth says:

    Flash, doesn’t bother me. I know loads of land value taxers, some are in UKIP, some are Lib Dems, some are hard core Socialists, others are Christians, some are Greenies, some approach it from ultra-capitalist point of view, others from a moral point of view. All of us broadly agree that LVT could and should replace other taxes (although we disagree hotly on which ones to go first).

    It is perfectly possible to be right for the wrong reasons and there are so many arguments in favour of LVT that inevitably some of them appear contradictory at first blush.

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  • Well done Mark!
    You know you have them beat with common sense when they resort to comments like:

    “..LVT is perhaps better known as ‘Loonies Volunteering Theories’ …”
    “..it doesn’t bear close examination..”
    “..it will never work..”
    “IT WILL NEVER HAPPEN!!”
    “So for f*ck’s sake mate – get a life”
    ”creative destruction”
    “adult portion of the debate”
    “one form of theft “
    “LVT is one gigantic yawn and a distraction from the real problems”
    “bingle-bongle brigade”

    ..to make their point. The LVT case is gaining momentum. Keep it up.

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  • mark: You didn’t address the consequences of a business leaving because they resented (or were bankrupted by) being taxed heavily during a long-term loss-making period. They would leave and there is no way around that reality. I was not talking about a situation where someone like Honda was thinking about expanding and could therefore afford to pay tax. I am talking about a far darker theoretical situation where they are trying to survive. Any tax on them at that time is counterproductive and short sighted. Also don’t forget (as if you would), to factor into your comparison that losses can be carried forward, under the current system, to reduce future taxes on profits. Also don’t forget to factor in that under the current tax system, business rates etc are effectively cancelled out because these large strategic businesses are given offsetting grants and other support by sensible governments who wish to protect their strategic manufacturing base. If you don’t support struggling strategic businesses, they have a habit of disappearing or being transferred to foreign ownership. This is a wrinkle you will have to sort out if you want LVT to survive it’s first white paper.

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  • mark: I favour LVT with a few pragmatic alterations. Failing that I favour a complete simplification of the tax code with the abolition of socially unjust horror stories like VAT. What type does that make me?

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  • mark wadsworth says:

    Flash, I don’t appear to have explained the maths of this properly. I have checked again and again, and replacing all taxes with LVT would amount to an average ninety per cent tax cut for Honda (which is what we would expect). It strikes me as inconceivable that even in their worst year that their total tax bill would have dropped below £53 million, it’s just not going to happen, that would mean that they only sold 18,000 cars instead of 139,000 (or instead of the 250,000 which is the factory’s capacity).

    And sure, instead of paying a varying amount between £400 million and £800 million a year, depending on how business is doing, they’d have a steady £53 million bill without the option. And sure, in the bad years, Honda will hold the local council to ransom and demand some sort of exemption, well hey, this is just a timing issue – the council is perfectly entitled to waive it for six months or a year if it so wishes, or the council could say “OK, we’ll let you defer this year’s bill and for the following nine (good) years, we want you to pay £60 million a year”. Do you not think that Honda can work out for themselves that in the good years, they have to put some of that £500 million tax saving to one side in case there’s a down turn.

    £60 million a year (or £300 per car) is incredibly much lower than the tax bill they’d get anywhere else in Europe. I advise companies on international tax stuff and we work out where the best place to locate is, and I know for a fact that Honda would not do a bunk, they just wouldn’t – there is no country in Europe which would charge them less than £381/car in tax, neither would they be bankrupted.

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  • “that would mean that they only sold 18,000 cars instead of 139,000”

    I am surprised that you said that. It is not true. It could (and very often does) mean any number of things. They could have suffered a series of catastrophic recalls. They might have front run a new technology and be selling loss leaders to carve out market share. They might be spending a fortune to catch up with competitors who stole a march. They might have bought or merged with a competitor and found out that their new partner was a money pit. The list is endless.

    “there is no country in Europe which would charge them less than £381/car in tax, neither would they be bankrupted.”

    This is also not true. There are plenty of countries (including us) who have effectively given money to struggling car companies. They don’t just charge them less than £381/car in tax, they actually pay them £xxx per car. There are many large, thriving motor manufacturers in the world that have at some stage been given money and long term support (as opposed to being taxed). Have a look at a potted history of Renault for example

    Now that we’ve established that, let’s get back to the matter of why you think that a Britain with LVT could get away with taxing a struggling motor manufacturer that was in in dire straits, when everyone else has a habit of giving them money to get then through their darkest days? We couldn’t get away with it and that is all there is to it

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  • mark wadsworth says:

    “We couldn’t get away with it and that is all there is to it.”

    I think we can agree that in the good years, Honda would expand production in the UK not elsewhere. Bad years are bad years, separate issue.

    I think we can agree that Honda like to play off one country against another. So it’s just a question of finding out what sort oftaxes other countries are charging and what bungs other countries are offering and seeing if we can match it.

    Faced with a £53 million annual tax bill and an investment in plant and machinery in Swindon of £1.38 billion, they are hardly likely to do a bunk just because of one or two bad years, it’d cost them five times that to dismantle it and start again, elsewhere, only to reverse teh exercise two years later because that can save £647 million a year by relocating back to the UK.

    And yes, we had a car scrappage scheme, which approximated to reducing VAT on new cars costing up to £15,000 to +/- zero – some calculations even say that the extra VAT collected was more than the cost of the scrappage scheme. So why not just get rid of VAT on new cars and have done with it?

    You haven’t quantified the amount of grants they get every year, but it strikes me as inconveivable that it would be anywhere near as much as the £700 million a year tax bill which I calculated above. If you like, we could continue to charge them £700 million a year in tax (which is the same as what they’d pay elsewhere in Europe) and then give them back £647 million a year in rebates to get the net bill down to £53 million (being the equivalent of LVT). Would that keep them happy? I suspect yes, so why not cut out the middleman and just charge then the £53 million? Or the local council can offer them some sort of deferment scheme in the bad years. You can invent as many complciations as you like, I’m just saying there’s no real need for them.

    Your point about losses is only relevant for corporation tax, which is tuppence happeny it’s only about a sixth as much as the VAT they have to pay. It strikes me as a bit counter intuitive to say that “If there’s no corproation tax, then there’d be no tax relief for losses”, well, that’s just one of the downsides of not having corporation tax.

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  • orcusmaximus says:

    @flashman – I don’t understand how you state that in a recession, a factory could afford to pay rent, but could not afford to pay LVT? Surely they are stuffed in either case!

    @mark wadsworth (well done on the guardian article by the way) – where you calculate that the factory’s tax bill is slashed 90%, you include PAYE. That is not a tax on the business, but a tax on the worker so should not be included. Also, I am concerned that if LVT is implemented in a fiscally neutral manner, if it reduces business taxes by this much, then this must result in a higher average tax take from non-businesses. IE us!

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  • In 1987, the French government wrote off 2 billion FF of Renault’s debt (that was when a billion really meant something). I think that’ll do nicely to persuade you that other governments have done quite a bit more than you would do for a dying but strategically important company, under LVT. I could give you many more examples of spectacular automotive largesse. The French did this because they saw Renault as strategically and socially important. I could also show you a thousand historical opinions criticising the decision but look at Renault now and then take a long look at the Indian, German and Chinese owners of our car companies. By the way, I’m generally all for throwing out the dead wood but we’ve also thrown out quite a lot of babies with our bath water.

    If you were to agree that you would charge (dying but strategically important) companies LVT while taking a view on simultaneously bunging them huge dollops of cash, then we could agree. Of course deciding which companies are worth saving is a nightmare decision. Is it a money pit or good investment? The French government decision to save Renault (and others) was derided for decades and the people who did it are probably now too dead to bask in the warm glow of acclaim. When Obama gave the ‘go’ to get Osama, he didn’t know for sure he was there. It could have been Jimmy Carter all over again but he is now acclaimed for his boldness.

    These strategic decisions are perhaps more important than the exact specification of the tax system. Either way, I am reminded of politicians who unexpectedly find themselves in power. Poor old Vince Cable spouted on magnificently for years and was probably horrified when someone called his bluff and gave him the keys to a government office. The terrible reality of government is that pure ideals get smothered by the daily compromises and Hobson’s choices that need to be made. The poor chap now looks like a scuffed tennis ball and people throw fruit at him

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  • hello orcus:

    “@flashman – I don’t understand how you state that in a recession, a factory could afford to pay rent, but could not afford to pay LVT? Surely they are stuffed in either case!”

    Some factories can’t afford to pay for toilet roll in a recession, so rent and LVT would both be out of the question, if they were that ‘stuffed’. My main point actually references factories that own their own land, so there is no rent for them to pay.

    As a separate issue, I think the government should help all factories to own their own land. As I said earlier, they encouraged Nissan to do this by selling them land at agricultural rates. If this were the case, then there would be far fewer leaching landlords for LVT to target and factories would be more anchored to our country

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  • orcusmaximus says:

    @flash – “In 1987, the French government wrote off 2 billion FF of Renault’s debt”. So the French tax system was not up to the job of saving the industry? Hardly a good argument against LVT! Anyhow, Mark already proposed that councils could defer LVT for companies in trouble.

    “Poor old Vince Cable…” Quite! If he wasn’t a politician, I’d feel sorry for him.

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  • mark wadsworth says:

    Orcus, of course I include PAYE. “The business” = the shareholders, investors, managers, workers, landlord etc. It’s all one thing. If (big IF) we had LVT then clearly the tax bill on “business” falls by £300 bn and tax on residential land and buildings goes up by £300 bn.

    So intead of your average Honda worker having £12,000 PAYE/NIC deducted from his salary, he gets paid gross and pays £12,000 LVT on his house instead.

    Honda is quite an extreme example, I’ve just offered them a £500 million a year tax saving (twice that, if they got production back up to full capacity of 250,000 cars per year) and they only employ 5,000 people at that site, they could give their employees a £6,000 gross pay rise each out of petty cash.

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  • orcusmaximus says:

    @flash – “factories that own their own land, so there is no rent for them to pay.”

    If LVT were introduced, then rent payments have to rise by some amount, so renting factories will have higher LVT/rent outgoings just like land owning factories.

    I know many people argue that landlords will not be able to raise rents because if they could, then they would do so now. However, that is a bogus argument, as we don’t have LVT now! Were LVT to be introduced, then ALL landlords would have higher costs, and most tenants would have drastically lower non-rental expenses. Accordingly, market forces would raise rents until they reach the new level at which it becomes cheaper for tenants to buy (and pay LVT) than rent.

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  • orcusmaximus says:

    @MW – I don’t think you can include workers in your business, include their PAYE, and then exclude their home LVTs! Hiding your debts off the balance sheet doesn’t make them go away, as the government is discovering.

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  • Orcus:

    “So the French tax system was not up to the job of saving the industry?”

    Yes it clearly was because they were saved and now prosper. The French tax system demonstrably includes outlier activities like writing-off 2 billion FF when it sees fit. That’s the beauty of systems that are not narrow in their design, philosophy and execution. It’s a complicated world and overly simplistic solutions can’t usually hack it. In any case, I think shite cars might have had more to do with their state than the prevailing tax regime. The assistance given by the French government helped them to live until they made better cars

    “Anyhow, Mark already proposed that councils could defer LVT for companies in trouble”

    So the French get 2 billion and our tight-wad(sworth) accountant offers to defer a few quid? Renault would have been long dead by the time they were expected to make their deferred £3.50 payment.

    orcus, I never knew you were so vehemently against LVT? In any case, I don’t think I could have ever crushed it, with only two sentences. Chapeau! 🙂

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  • orcusmaximus says:

    @flash 🙂

    My point is that the French saved Renault by taking measures outside of the tax system, and I do not propose that LVT prevent a government doing anything outside of the tax system either.

    So the French get 2 billion and our tight-wad(sworth) accountant offers to defer a few quid? Renault would have been long dead by the time they were expected to make their deferred £3.50 payment.
    Now you are making our point! If a company is in trouble, then the amount demanded by LVT is not going to be significant.

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  • mark wadsworth says:

    Flash, OK, so France once wrote off 2 billion FF in the dim and distant, and I offered to reduce Honda’s UK tax bill by £647 million a year in the bad years and twice that in the good years and somehow my policy is worse. Like I say, we can dress this up as a gimmick where we charge Honda normal tax of £700 million a year and then pay them back £647 million in “subsidies” each and every year. I am quite sure that Honda’s tax advisers are perfectly capable of doing these sums for themselves.

    Orcus, a tax on residential land is not a tax on business. In fact, a tax on commercial land is not a tax on business either. What I suggested was no tax on business whatsoever. LVT is not “hiding” anything anywhere, LVT (like Council Tax) is completely IN YOUR FACE. It’s up to Honda’s employees to decide whether to live in a flat and pay £4,000 a year LVT or to live in a mansion and pay £30,000 a year, that purely discretionary personal spending.

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  • UT Said:

    “1) Couple (a) are both working, have no children, and for that reason have no need of a large home. Couple (b) have children, only a single income while the other takes care of the family; and because they have children, need a larger family home.

    Clearly, couple (a) are much better off than couple (b); but under LVT, couple (a)’s tax burden would be reduced while couple (b) would have to pay more. That is manifestly unjust.”

    I’m not sure I follow your logic here. Raising a child has added costs – there’s no getting around that. Part of those costs is living space, which requires access to land. Currently you’d be paying interest on inflated prices to the bank. Instead, MW’s suggesting paying the rent to the government as your tax instead of having your wages docked and your trade skimmed. Because of existing mortgages, one of the transitional issues is how to tax mortgaged properties. That goes away once existing mortgages are completed.

    There is a question of the family with the child having an increased Citizen’s Income, but that’s one aspect the proposals that I’m not fully familiar with yet.

    2) A couple (or single person) has planned their retirement prudently and responsibly. Having paid off their mortgage, weaned the kids and downsized to a home of modest proportions, they have just enough income from their pension arrangements to get them by. They consequently pay very little tax at present.

    If they have downsized suitably as you say, then they’ll pay very little tax with LVT as well. Indeed, with the CI, they may even be net tax recipients.

    There are transitional issues, which all stem from people having maximised their situations under the current rules, but that isn’t an argument against LVT, that’s an argument against changing anything ever. MW has already mentioned a couple of possibilities for ways around them, but none need be permanent features of the system. They would be purely political rather than economic considerations.

    Flashman said:

    “It could (and very often does) mean any number of things. They could have suffered a series of catastrophic recalls.”
    ….and you want to reward them with a tax break? That’s throwing good money after bad. One catastrophic recall can be unfortunate, but one catastrophic recall a bankrupt company doth not make, and a series is just plain careless…

    “They might have front run a new technology and be selling loss leaders to carve out market share.”
    …we’re going to base our tax system on companies’ marketing plans?…

    “They might be spending a fortune to catch up with competitors who stole a march.”
    …that’s what capital investment is for…banks used to do that once upon a time…

    “They might have bought or merged with a competitor and found out that their new partner was a money pit.”
    …do the words ‘due dilligence’ mean anything these days…

    “The list is endless.”
    What’s interesting is that these are not arguments against LVT, they are arguments for state interventions and bailouts. If we really think that interventions and bailouts are a good idea, they can be considered separately, but there’s no actual requirement to meddle with LVT to do it.

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  • orcus: you say it was outside their tax system and I say it was part of their tax system. It’s a tough call but their tax system was not repealed or altered in any way to enable this write off, so I’m quite sure it’s at least reasonable to say that the write-off was part of their existing tax system. Write-offs are not unknown (evidently) in our system or theirs. I previously asked mark if he’d agree to a similar bung under certain cicumstances, which is my way of eliciting an admission that LVT can never be executing in its purest form. That, in a nutshell, is the only point, I wanted to make today. I am not remotely against LVT but it is instructive to me that certain elements do their nut if you even look at it the wrong way. It never used to be like this when I first debated it as a student.

    “If a company is in trouble, then the amount demanded by LVT is not going to be significant.”

    So why bother? Going to the administrative trouble and expense of charging a small amount of tax to a company that you are simultaneously bunging huge amounts money to, is something that Joseph Heller would have enjoyed. The insistence on doggedly charging this tax when doing so is as quixotic as described in the above situation, smacks of zealotry.

    By the way, I’m glad you are on board. I love a good debate

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  • mark: Your offer is actually worse because you intend to get your LVT payment (even if it is deferred) and not a penny less. The French simply gifted a giant write off and many other straight gifts, to several other companies and industries. They deferred nothing. The Americans colluded with GM to let them go bankrupt in such a way that they would be reborn all shiny and new, without huge debts and union obligations but with everything important still intact. One way or another that cost a lot more than a poxy 2 billion FF and still nothing deferred. Our government tried to offer similar largess with the whole British Aerospace/Rover/BMW debacle but of course they cocked it up badly. They actually pretended to sell it all for a quid at one stage but it was later revealed that they had actually paid a fortune to get it taken off their hands. My god, we’ve been badly run from time to time

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  • orcusmaximus says:

    @flash So why bother? Going to the administrative trouble and expense of charging a small amount of tax to a company that you are simultaneously bunging huge amounts money to, is something that Joseph Heller would have enjoyed. The insistence on doggedly charging this tax when doing so is as quixotic as described in the above situation, smacks of zealotry.

    Good point. One of the main purposes of LVT is to stop giving with one hand and taking with the other.

    Can you back me up against Mark when I say that you cannot include employee PAYE when stating how much less tax a business will pay under LVT? Or do you agree with him in this?

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  • orcusmaximus says:

    @flash Your offer is actually worse because you intend to get your LVT payment (even if it is deferred) and not a penny less

    Not so, Mark is saying that he is making an annual gift of the difference between the LVT tax amount, and the current mix set of taxes tax amount.

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  • mark wadsworth says:

    Flash, let’s imagine you are deciding where to site your European offshoot of Flashman Worldwide Industries Plc. Do you choose

    a) Country A, where the tax bill is a fairly predictable £53 million a year, year in, year out, regardless of how well or badly you are doing, or

    b) Country B, where the tax is £250 million in bad years and £1,000 million in the good years, and where, if you bribe the right people, occasionally you might get £500 million written off?

    As CEO of this major corporation, would you not be capable of putting a bit of money into reserves to tide you over the bad years? Is your average tax bill not going to be ten times higher in country B?

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  • mark:

    “As CEO of this major corporation, would you not be capable of putting a bit of money into reserves to tide you over the bad years? ”

    That would be nice and tidy but the world and its people are generally not particularly nice and tidy. There is, in fact, overwhelming evidence to suggest that there has not been the recommended prudence, in most important companies over the decades. What you are in effect saying, is that LVT will not be harmful be to these companies ONLY if they are perfectly managed and save their pennies, so that they can continue to pay LVT during a rainy day (recession). Many of the companies we have talked about have evidently not saved their pennies and ended up skint and in need of a bailout. That’s life, and we can’t invent a new nature for the human race or rewrite history, just to make pure form LVT fit every situation. It clearly doesn’t and it can’t. Some of the poorly managed basta*ds should be allowed to go to the wall but sometimes we’ve got to consider helping them for the future health of our economy. The French, Italians and Americans are now rather pleased that they dished out huge dollops of support and we are left looking on enviously. Politics is no different. Gordon Brown and many others in his position should also have saved his pennies, in the good years but they just plain didn’t.

    orcus:

    “Not so, Mark is saying that he is making an annual gift of the difference between the LVT tax amount, and the current mix set of taxes tax amount”

    Like I said, he is not being nearly as generous because he still wants to charge them something. Renault and several others got huge gifts with no repayment required. I’m quite sure mark would do the same if he actually got his hands on the levers. If he didn’t then he wouldn’t have his hands on the levers for very long. Voters tend to value their jobs and homes quite highly so politicians rarely have the freedom to be as pure as they’d like. I suppose we could get away with purity in a dictatorship?

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  • orcus:

    “Can you back me up against Mark when I say that you cannot include employee PAYE when stating how much less tax a business will pay under LVT? Or do you agree with him in this?”

    Yes, I think you are correct. I think that the marketing of a concept sometimes intrudes and big numbers like ‘90% savings’ sound very catchy. I suppose you have to market things that you are campaigning for because everyone else does it. I don’t think mark’s claim is any more sinister than combing your hair before a date. It’s the same amount of hair but it looks better

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  • mark wadsworth says:

    Flash, how is PAYE not a tax on business income? What sort of income is it if not business income?

    Let’s imagine the UK government sets up an Enterprise Zone where there is no obligation to deduct PAYE and you can pay employees their salaries gross and employment income is tax-free in perpetuity. Would this make the EZ more or less attractive to employers?

    I submit it makes it more attractive, but you and Orcus appear to disagree.

    “What you are in effect saying, is that LVT will not be harmful be to these companies ONLY if they are perfectly managed and save their pennies, so that they can continue to pay LVT during a rainy day (recession).”

    No, what I keep saying is that any sensible manufacturer would

    a) prefer somewhere where the land is cheap and there’s a fixed tax bill of £53 million year to

    b) a country where land is expensive and the tax bill is anywhere between £250 million and £1,000 million, but if you bribe the right politicians, you might get the occasional £100 million rebate (such as the car scrappage scheme).

    It was you who said that we have to have some sort of ‘industrial policy’ (despite listing loads of examples where it went wrong) so tongue in cheek I suggested that we charge then full tax of £700 million (the same as they’d pay anywhere else in Europe) and then pay them a rebate of £647 million every year (even though I think this is pointless). I fail to see why this is better.

    You obviously disagree so I hereby throw in the towel.

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  • shipbuilder says:

    I think a good idea always wins through and the huge increase in the number on here who have witnessed the debates and read the explanations and come out in favour of LVT is testament to that.
    While those of us in favour of LVT support it, as pointed out, for very different reasons than just its comparative simplicity (personally, allied with a citizen’s income, it reflects my views on property ownership and socialism), it’s good to see the agreement that, for all its faults, it’s an improvement on the current system. After all, this is all its supporters ever claimed it to be. Good debate.

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  • “Flash, how is PAYE not a tax on business income? What sort of income is it if not business income?”

    I don’t think you’ve understood orcus’s meaning. It was not my point so you should address it to him but I will say that it is a deductible busines expenditure that is used to reduce the cprporate tax bill and expenditure cannot possibly be considered income. It is an example of why you have to be careful when making your sort of 90 % savings claims. It’s very tempting to put stuff into a convenient column that makes the comparable seem better than it actually is. It’s an accounting slight of hand (as orcus has already said).

    I wont pick apart the rest of your post on a point-by-point basis because there comes time when it gets a bit ‘in your face’ and I don’t think you’ve directly responded to most of the comments I’ve already made. I think the disconnect arises from what I perceive to be your tendency to dodge any specific criticisms by defaulting to listing the benefits of LVT, or answering a question that was not actually asked. We all know there are many benefits to LVT but you will have to face up to and accept its very obvious, well proven deficiencies if you want it to be taken seriously by more than 0.05% of the population. Absolutely nothing is perfect and if you insist that it is, you will miss the opportunity to polish it up into something that might stand a chance of getting serious consideration. I’ve always liked LVT but most economics students get into it and then they inevitably drift away from it when they start the more intense stages of study, discussion and modelling. It is simply not good enough to read a book that vehemently advocates it (mark, I’m no longer talking specifically to you) because everything seems good that way. I once bought a miracle supplement based on a book and was amazed when it didn’t do anything. It is unfortunate that most people will never get the chance to rigorously stress test LVT in a disciplined academic environment. On the other hand almost everyone who does get that chance, drifts away from it, so no harm no foul. Its biggest flaw is its ideological refusal to bend or compromise. That sort of zealous inflexibility appeals to some people but it also why is never gathers much support. It used to be an ‘economic students only’ topic so it’s good that its now also being talked about by a handful of bloggers but I’m sorry to see it getting the traditional blog world treatment of being reduced to a series of half truths and out of context slogans. It never got anywhere when it was only ever discussed on the campus but it will surely be killed stone dead by its incarnation as the latest hobby horse for a disparate group, who don’t all know exactly what it is and what it does. If it’s just a hobby or a flag of convenience then by all means agree with each other and beat your LVT chests all day on an obscure blog. There’s no harm in it. If you seriously want it to fly then accept that it is not perfect and then polish it up into something that is more workable.

    regarding shippy’s: “allied with a citizen’s income”. That’s exactly the sort of thing I’m talking about. It needs additions. Think of it as LVT +

    Thanks for the debate chaps

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  • greenmind says:

    Flash @ 86: did you know that Value Added Tax in France is more or less the same rate as in the UK. Is the subsidy offered to car makers worth that much? I dont imagine so, which means MWs LVT scenario would be more attractive.

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  • mark wadsworth says:

    F, I have really tried to address all your points, and I asked a simple question – where would Flashman Worldwide Industries plc choose to site its European operations (comment 88, repeated above) and you did not answer it.

    Neither did you answer my question about where you would rather site your business – where employment income is tax free or where it’s subject to PAYE/tax/NI.

    If you want to split hairs, then feel free to call PAYE tax on “employment income” and not “business income”, it all looks like much of a muchness to me – let’s assume one of Honda’s suppliers is a small business run as a partnership, so technically the partners get ‘self employment income’ and another one is a limited company, so the workers get ’employment income’ the directors/shareholders get ’emoluments’ and ‘dividends’ and the company’s retained profits are subject to corporation tax. Both of them make money from “manufacturing car parts” so it looks the same to me. But unless I am much mistaken, they look different to you.

    “The latest hobby horse for a disparate group, who don’t all know exactly what it is and what it does.”

    I am not a disparate group, and for most it is not a ‘hobby horse’. People like Fred Harrison or Dave Wetzel have been campaigning for forty years. Admittedly they have achieved nothing, and neither do I expect to achieve anything. I have answered all your questions, backed up with numbers and logic and I know exactly what it is and what it does. It is a tax on land values. I can tell you exactly who would pay more and who would pay less. You might as well ask me “what is tobacco duty” and the answer is it’s a tax on tobacco.

    “If you seriously want it to fly then accept that it is not perfect and then polish it up into something that is more workable.”

    The joke here is that we in the UK are so brainwashed by Home-Owner-Ism that it doesn’t matter what I suggest, I got stupid counter arguments five years ago when I first suggested rolling Council Tax, SDLT, Inheritance Tax & TV licence fee into a flat 1% annual tax on the value of residential land and buildings, and I get the same stupid arguments when I suggest scrapping all taxes whatsoever and rolling them into a flat 8% tax on the current value of residential land and buildings, so I may as well be hung for a sheep as a lamb.

    No amount of polishing will get us past these few stupid objections:

    1. The Poor Widow Bogey.
    2. It’s moi laarnd and Oi’ve paid for it.
    3. But I bought my house out of taxed income.
    4. My home is my pension/investment/something to leave to the children.
    5. But valuations will be so expensive and complicated.
    6. But the financial system will collapse.
    7. It’s anti-capitalist.
    8. Poor people will be forced out of their homes.

    I have dealt with these a zillion times and suggested exactly how it would work in practice and then I end up arguing with people who say that having a tax bill of £700 million a year is better than a tax bill of £52 million a year and then I despair, I really do.

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  • the number cruncher says:

    LVT is pretty mainstream in academic circles, but any advocate of it working in the finance industry would be quickly out of a job

    The problems of LVT (I use the word Georgism) are the rich and powerful do not like it and there is no profit in it for lobbing to fund its passage into law or special interest groups with money behind them.

    LVT has been well developed by many economists and politicians to match the increasing complexities but its fundamental truth ls unchanged.

    With our ever growing economy, land and natural resources capture the majority of created wealth, these are in the private ownership of a few individuals who have subverted Government to keep their unearned income untaxed. Landowners and monopolists are parasites sucking out the earned wealth of real investors, business people and workers.

    Henry George described house price bubbles and crashes and thier social effects perfectly in 1870, and he was not ignored, he had a massive following, and the problems he described are the same problems we face today. His proposed solution was a LVT, and he described its implementation in ways that where subtle and took into account all the things flash has been banging on about.(but no explanation would be good enough as it not his idea)

    If you listen to Vince cables speeches you can hear him make lots of references to unearned income, housing bubbles and he is leading the fight for property taxes, he understands georgism and LVT very well. Vince is the only real economist in the cabinet, and who was very successful in his career. Vince and many other mainstream economists and politicians understand the issues at stake. But they also understand how many rich and powerful hate LVT, as at a stroke it would make them work for their unearned income and take away the advantages enjoyed by landowners for centuries. It is the self interest of these groups that attack politicians who propose LVT.

    I have an excellent example in the Australian prime minster, She got her Job because the labor PM before her proposed a resource tax on the large mining conglomerates. The mining interests paid lobby groups and funded his internal opponents within the Labor party to attack him and mount a leadership challenge to unseat him. The present Australian PM quickly lowered d the resource tax and enjoyed the patronage of her powerful backers.

    Its concentrated private media ownership and events like these that keep LVT off the political and economic agenda and not the failings of its proponents.

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  • @flash
    >I think the government should help all factories to own their own land. As I said earlier, they encouraged Nissan to do this by selling them land at agricultural rates.

    That’s tantamount either to the total abandonment of town and country planning or the preferential treatment of certain companies above others. Is that really what you are suggesting? Sounds bonkers to me.
    Nick

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  • mark: You are behaving more like a politician every day. You got caught fudging the figures so you tried to divert attention by claiming that a plain fact was just ‘splitting hairs’. It reminds me of the excuses politicians made in the expenses scandal. Also, just like a politician, you never directly answer questions that would produce unfavorable marketing material. Instead you rehashed your old ‘stupid argument’ list and cited homeownerism. I don’t think anyone made any of those arguments here, so what was the point of the list? By the way, I don’t respond to any points you make if they are part of an answer to a question I didn’t ask or an answer to a question that you altered to suit a potted answer. I cut my teeth in university debating teams and I am too long in the tooth to be sidetracked by those old Politician’s tricks. I am in fact quite exasperated by your refusal to directly respond to anything where an honest answer would shatter the impression you like to give of LVT being a magic panacea for all ills. Roll up, roll up! Neat trick though, accusing me of doing the same thing

    You quite cheerfully admit to knowing that you wont get anywhere with LVT, so the question is why are you wasting your time flogging such a dead horse? You are usually an even tempered soul but I notice that you get quite agitated if anyone disagrees with your translation of LVT or asks an inconvenient question that is not from your ‘stupid arguments’ list. I am beginning to suspect that this is just a compulsion of yours and that you would be happier repeating the same stuff every day, without debate or response.

    What people here don’t realise is that your notion of who would pay what, is a little rogue to say the least. Most traditional LVTers would rather resent what they would see as your hijacking of their tax. Your strong right wing bias (very UKIP) has influenced your preferred apportioning of the tax. For example you are very well known to be very pro private business (90% savings minus fudges) and very anti state spending, non front line council staff and dole scroungers etc. Your LVT apportioning echoes these preferences (what little you let slip). Most of your newly minted LVT chums would string you up when they saw who you would tax less and who you would tax more. Orcus sussed it out and asked a pointed question on the subject, which of course you ignored.

    You try to give people the impression that LVT is a magic tax that would save everyone money. Of course, you don’t get too specific because there would be some very unhappy bunnies with a larger tax bill (and I most certainly don’t just mean the rich). Most of the folk here instinctively like the sound of LVT because they don’t have a house and it kinda sounds like it would give then something that came from someone with a big house. It’s not actually true so why don’t you tell them? While you at it why not tell them how it would actually increase the price of many houses? Come to think of it, in all the LVT drum banging on this site, I’ve never seen anyone tabulate exactly who they think would pay what and who would get less or more. I imagine the HPC LVT crew (all eight of them) would fall out pretty quickly and the moderators would be deleting comments left right and center from non LVT’ers. How about it?

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  • nickb: “the preferential treatment of certain companies above others”

    I clearly said ALL factories, so where do you get the preferential treatment idea from? I’d also like all businesses to own their own premises/land and and all people to own their own land and houses. Do you like landlords leeching from productive businesses and wage earning people?

    “That’s tantamount either to the total abandonment of town and country planning”

    That’s a crazy comment. Either they’d already be operating on the land they bought or they’d put in a planning application for a new site

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  • greenmind:

    “Flash @ 86: did you know that Value Added Tax in France is more or less the same rate as in the UK. Is the subsidy offered to car makers worth that much? I don’t imagine so, which means MWs LVT scenario would be more attractive.”

    Not remotely as attractive. You can’t compare a reduced tax rate to a gigantic gift. Would you be better off if your tax bill was reduced or if I just gave you a billion quid?

    I have known all about LVT since the 80’s and the same tease works just as well now as it did then. LVT fanatics (only the newly minted ones) hate to admit that that LVT is not always enough for every eventuality, so they get themselves into a pickle trying to pretend that a deferment of LVT or some such tiny response would be just as good as a multi billion pound free bailout. They are just being silly and the truth is that even a LVT based government would give giant subsidies to selected dieing, strategic businesses (unless they were a nutter like Thatcher).

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  • By the way greenmind, do you understand the difference between an individual paying VAT and a business paying VAT? Do a Google search on “VAT registered business” (all large buinesses are VAT registered). You will soon a red herring in the VAT portion of your question

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  • the number cruncher says:

    If you cannot attack the policy – attack the people who propose it, undermine their credibility – create a false black and white, either or, augment. Use the augment that un-credable fanatics want an extreme simplistic form of the policy.

    Now who is the politician on this site?

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  • orcusmaximus says:

    @flash in all the LVT drum banging on this site, I’ve never seen anyone tabulate exactly who they think would pay what and who would get less or more

    That’s an interesting subject! I’ve taken it to be:

    • The average voter will pay the same, or slightly less (assuming we deduct Citizen’s Income if that is also introduced). This is so fundamental, that without this, LVT will never get anywhere.
    • The super rich will pay more, as there will be minimal avoidance
    • The overall tax bill will be reduced due to massive efficiencies in collection
    • Most people working in the tax industry will need to find new careers and will suffer in the short term.
    • Over time, the people on benefits will reduce as there will be massive incentive to work. This will radically improve society, and further reduce the average tax bill.
    • The Poor Widow Bogey will find out that there was nothing for her to worry about after all.
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  • orcusmaximus says:

    @Mark Wadsworth So intead of your average Honda worker having £12,000 PAYE/NIC deducted from his salary, he gets paid gross and pays £12,000 LVT on his house instead.

    So you admit that under LVT, instead of paying your workers £X,000 Net and the Government £Y,000 PAYE, you pay your workers £(X+Y),000 Gross instead. So where does the business make it’s £Y,000 PAYE savings? Or are you suggesting that to achieve your 90% business tax savings, your company will stop paying PAYE, but carry on giving the workers the same amount as they previously recived NET, in effect a massive pay cut?

    Please admit that you’ve fudged your statistics and give us a more realistic value! As Flash says, you’re doing yourself no service in trying to weasle out when caught red handed.

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  • Tnc: It is a shame you have littered this post with your usual display of emotional incontinence. You offer absolutely no value and this site would be far better off with out you and your identities. This post has got to 100 because I have stimulated debate. Without my efforts it would have scrolled off with a few disinterested comments. Your display of knowledge free inanity very nearly persuaded me to not bother (always the main objective of a certain element) which is a shame for this site and the many contributors that enjoy a lively debate. You are one of the last of your kind and it’s time the moderators took a proper look at you.

    Everyone else: Thanks for the debate.

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  • orcusmaximus says:

    @Flashman – thank you for the debate. I learned something yesterday. Now for today!

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  • the number cruncher says:

    Flash – I have only one identity – your paranoid is very telling, I am not the only one you have accused of multiple identities. Your plea to the moderators is very telling as well. Like all bullies you have a big cry when you do not get your own way. I think a little maturity would do you the world of good. But to be fair I do enjoy reading most of your posts and having my brain stimulated by your questions. Your biggest problem is that your so determined to win the debate you actually loose track of the debate’s substance and start hectoring and attacking the posters and using questionable debating practices of the JCR such as staw man augments, of which you are quite the master.

    I will give me twopennyth on your musings, you are free to ignore them.

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  • orcus @100: There can be little doubt that society would be fairer and stronger with the proper imposition of a pragmatic form of LVT. However I fear that it would inevitably be hijacked by politicians and used as a cover for whatever insidious plan they wished to lay on us. I have no doubt that a section of society would be targeted and made to pay dearly. I strongly suspect that it would be the less advantaged who get it in the neck because LVT is all about maximising productivity and an atmosphere would be created where the supposedly unproductive are looked at with suspicion. That is why I like the addition of a citizens income. It would guard against the effects of zealotry

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  • orcus: do a search on “why I’m against citizens income funded by LVT”. You will see what I mean about the unproductive being treated with suspicion. I think it’s written by the output of an illicit affair between Norman Tebitt and Henry George. The sad truth is that most LVT supporters just want a bit more of the pie for themselves (and/or they want to target someone else). The trouble is that they can never agree on who gets what bit of the pie because they are a completely disparate group. These are the conclusions that most of us came to 25 years ago and nothing has changed. It’s always politics and greed that gets in the way and LVT is far from immune

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  • orcusmaximus says:

    @Flashman –

    LVT is all about maximising productivity and an atmosphere would be created where the supposedly unproductive are looked at with suspicion
    This is no difference from the situation we’re in now, where anyone on long term benefits is viewed with suspicion if not hostility from taxpayers.

    With the “why I’m against citizens income funded by LVT” article, I agree with the author that there is a problem with what do you do for those who can’t work, but completely disagree when she says that “A Citizen’s Income provides an incentive to work less.”.

    I think you’re pretty much spot on with everything else you’re saying though. But an agreement doesn’t make for a fun debate!

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  • Cheers orcus: I’m not completely blind to the fact that there are genuine scroungers but I take the rather wet view that most of the poor sods are created by society. A few of them just need a good kick up the ar*e

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