There are a number of us who think that Land Value Tax should be implemented (Hey, even Polly T has been known to mumble about it) as a solution to at least some of the ills in our current taxation system. The imposition of such a system would include measures like this:
Tax inspectors have divided England into 10,000 new "localities" with each neighbourhood ranked on the socio-economic class of its residents and environmental factors such as crime and traffic levels.
The inspectors have even purchased demographic data disclosing how many company executives, pensioners or students live in particular streets, The Daily Telegraph has learned.
This has been collated on a secret database which is being used to assess the desirability of neighbourhoods to help determine council tax bills if Labour wins power again at the next election.
The Conservatives have branded the proposal "a nice neighbourhood tax" which will penalise middle class families struggling to cope with the economic downturn. It is feared the revaluation will quickly be implemented if Labour wins the next election to help fund the growing deficit in Britain\’s public finances.
LVT is of course designed to capture the value that society itself adds to a particular piece of land. A "nicer neighbourhood" is an excellent example of exactly that. So this would appear to be a step forward.
A revaluation was due to be conducted in 2007, but was postponed until after the next election over fears that millions of families would see a significant hike in their bills. The average annual council tax bill is already almost £1,400 a year and a recent study suggested most town hall leaders were expecting above inflation increases next year.
The information seen by The Daily Telegraph however, suggests middle class home owners could be facing even more punitive council tax rises if Labour wins a fourth term.
However, leacing aside the LVT aspects, I\’m not sure why a revlauation should raise council tax in general. It shouldredistribute it, for sure, as different areas have increased in value by different amounts, but there\’s no reason why a revaluation should lead to higher bills in general.
Although, of course, I submit to the obvious logic that any change in any tax system is going to be used to raise the general level oftax.