Smart Tax: Land Value Tax

1. Smart Tax: Land Value Tax Feasta led-policy development

2. What is Land Vlaue Tax (LVT) • A location benefit levy for the use of value notcreated by the land owner. Buildings and improvements are not taxed • The value provided by nature (such as soil and view), public services (such as roads, sewerage, water schools) and from the social commons (such as businesses, community solidarity, rule of law) is taxed and used to conserve and create more value

3. How does it work • Land is valued to create a land value map and is kept up to date from sales and rent information • Ownership is registered for every m2 of land in the country • A percentage of the rental land value is set - say 20% (circa 2% of capital value); that is the LVT • Every owner pays annually in a convenient way

4. Benefits • End of land speculation and dereliction and underused • Reliable and sufficient funding for roads, water, sewerage, energy, amenities, community services • End of housing bubbles: housing is always kept affordable • Productive enterprise businesses is incentivised as tax is lowered on work

5. Issues • Allowance to reflect equal share of land value commons leading to citizens income over time • Reduction for those who bought recently • Reduction for older people • Roll up for low income, high value location to be paid on sale or death • Non-zoned landowner to pay as lump sum with planning permission • Reductions and waivers for designated land and buildings