Written evidence submitted by Henry Law [HLV 004]

There have been four failed attempts to capture land value uplift

1947                            Town & Country Planning Act

1967                            The Land Commission

1975                            The Community Land Act

1976                            The Development Land Tax

OTHER MEASURES

Planning Gain amenities and charges

Community Infrastructure Levy

Business Rate supplements and ad hoc contributions eg for the Elizabeth Line

The challenges – 1

Free riders – not all beneficiaries contribute and it is impossible to define who they are, to quantify the benefit, and determine what would be a fair contribution

The challenges – 2

Large one-off payments triggered by planning consent or other events are a substantial deterrent

The challenges – 3

The benefits are not a one-off bonus but continue into the future

The challenges – 4

Money may become available at a time which is not optimal, leading to spending on projects for the sake of it

The challenges – 5

Delivering 1.5 million new homes raises important and difficult questions. Crash building programmes in the past have left a legacy of social and environmental problems in the UK and abroad, notably in the USA and Sweden. My own work consisted in interventions designed in a vain attempt to alleviate the shortcomings in the original schemes.

Where will they go?

Are the labour and materials available to sustain such a large amount of development within the timescale?

Large scale development will need the supporting infrastructure of utility services and social support eg schools, shops, medical facilities, recreational facilities and much else. Where is the provision for this.

How will they be allocated?

How will such large developments be managed when built?

CAPTURE OF LAND VALUE UPLIFT IS CONCEPTUALLY FLAWED

The real value of land is its annual rental value, not its selling price. Land delivers a revenue stream, the rent. Selling prices are a derivative value, based on interest rates and expectations – “hope value”

Land value taxation addresses all of the above objections and difficulties as regards land value capture as well as providing a future income stream for the upkeep of the supporting infrastructure which this development will requIre

Infrastructure enhances and sustains land rental value. A tax on annual rental values perpetually captures a portion of this value as precisely as is reasonably practicable

LAND VALUE TAXATION ADDRESSES ALL OF THE ABOVE OBJECTIONS AND DIFFICULTIES – with a bonus

A national land value tax can replace all existing UK property taxes: Council Tax, Business Rates, Stamp Duty, Community Infrastructure Levy and Inheritance Tax

Huge administrative savings

January 2025