Talking property tax on WLR FM

We spoke to WLRFM yesterday (sound file here) about some of the contentious issues with a market value based property tax. Using values will ensure that the quantum collected is not strictly linked to any costs associated with running a local authority.

In the past this was a huge problem, it was the reason our last property tax died off, and when it came to domestic rates, it was used as political fodder in the 1977 general election where its repeal swung the election.

There are alternatives, Site or Land value tax and to have the tax linked to costs of a local authority would be far better, but we are instead opting for the path which suits the Government most rather than those who pay it.

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Site Value Tax: What is it? How does it work?

I volunteer with a group called Smart Taxes who are a sustainable taxation think tank. This has post is taken from their site (original in link above), and it is well worth reading if you want to hear about the reasoning behind using site value or land value taxation as opposed to ‘property taxation’.

Site Value Tax is a taxation reform included in the Irish government’s current Program for Government. It levies an annual charge on the value of all developed and undeveloped zoned land including the site under every building in residential use.  It does not include un-zoned land i.e. agricultural land, forestry and peat-lands.  It does not include developed commercial property currently subject to local rates but it is expected that SVT will replace commercial rates in due course.  It does however, include land zoned for commercial uses not currently subject to rates.  Research by Smart Taxes and other groups has shown that SVT has clear benefits over other kinds of property taxes from a number of perspectives; macro and micro-economic, environmental and social. …

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The best monetary decision will be that which is taken

I have looked back at market crashes, the Dutch Tulip Bulb crash, the Railway crash in the USA, the Great Depression, the Oil Crisis in the 70’s, The 1987 Stock crash, the S&L crisis, the dotcom bust and our most recent and several things have become clear.

The ‘solution’ is whatever was done at the time thus meaning we try to find the answers of tomorrow by looking back at what worked in the past and applying it to the new situation, it is one of the most basic human methods of learning. Children will get a burn from a fireplace once and it is then engraved in their minds that fires are hot and can burn you. Thus we see the same happening with monetary policy and with businesses.

The question though is this: What if what we did in the past was wrong? Does it make a solution that appeared to work relevant? If for instance I was the sole solution provider for the Great Depression …

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