Monday, June 04, 2007

LibDem Tax Policy: From Their Own Mouths


In an article in the latest edition of LIBERATOR entitled Reducing Whose Tax Burden, Andrew Duffield (member of the LibDem Federal Policy Committee and PPC for Hexham) and Tony Vickers (Lib Dem Newbury Councillor, chair of the Lib Dem campaign group Action for Land Taxation and Economic Reform, and land policy researcher at Kingston University) argue:
As it stands (thanks to Local Income Tax), our tax policy actually increases the burden on wealth creating wage earners by around 3% - despite conference asserting that it “supports the principle of using taxes on resource usage to help cut taxes on wealth creation” by endorsing Fairer, Simpler, Greener….
They attack the ‘duplicity of a 2p green tax switch and a 4.5p LIT rate, which currently raises the overall burden on jobs’.

And they say that ‘we have a tax policy that will remain unsustainable and unfair to millions, despite two years of discussion’.

Just thought you should know.

25 comments:

Old BE said...

There will never be a reconciliation within the LDs between the socialists and the libertarians.

dizzy said...

Hexham? Well he doesn't stand a chance.

Inamicus said...

I know Andrew well and both he and Tony Vickers are dyed in the wool land taxers and site valuation ratings enthusiasts. Their ALTER pressure group philosophically rejects most forms of income tax, so it's not really a surprise they're critical of the plans - it's ALTER's raison d'etre.

Anonymous said...

This is news? You've clearly not been reading half the Lib Dem blogs out there (including mine). There's much more at: http://www.libdemsalter.org.uk/ and http://www.1909.org.uk/

Newmania said...

Fantastic spot Iain... Gives you some idea what you would get if Brown and the LD lie machine ever formed a coalition under PR.

APOCALYPSE

Anonymous said...

Oh, come on Iain, do better than this? This story amounts to
"Some members of party disagree with Leadership's policy on tax".

Oooh. What an insight.

Wait a minute, I've got a similar scoop! "Significant number of Tory MPs support 'flat' taxation - see http://www.cornerstonegroup.org.uk/Being%20Cons.htm "

Praguetory said...

I support land value tax which meets all the canons of taxation. Fabulous idea. In addition to facilitating efficient use of land, unlike the range of property taxes it could replace (CGT, stamp duty, council tax) it does not penalise building/improvement of property and As such it is market solution for the housing crisis.

Anonymous said...

I am going to be really interested to see the impact of blogging on party campaigning at the next election. Although this isn't specifically from a blog, there must be loads of highly quotable stuff out there (from all parties) that could be used.

It's going to be interesting, and I am sure I'll read about it first at Iain Dale's Diary!!!!

Newmania said...

Anon 8 .10 -

No what they are saying is that the effect of Liberal taxation punitive on working people. Its not "disliking it " its just clarifying what it is. I see 50% top rate is in the air and while that might be something many could live with at above £100,000 taken with the mutterings from left quarters about redistribution being back on the menu its
Armageddon out of here if Brown gets in and that includes with the Lib Dems on a promise of PR ,the only realistic way.
I think the truth is that the Libertarian element of the Libs has finally been leached away and what you have is essentially a quirky sort of Socialist Party.
I have always found them “The stupid Party” , having no ideological language , economic grasp or description of society.

Unknown said...

praguetory - I agree.

Does anyone know if there is any interest in the Tory party in land value taxation? Or is it just a niche Lib Dem thing?

Praguetory said...

James - there are some right-wingers who are interested in LVT but I haven't heard any Conservative MPs express a view. If you wish to discuss further mail me at praguetory@gmail.com.

Anonymous said...

The Bow Group produced a pamphlet seemingly recommending LVT last year, but on closer inspection it turned out to be a boring old property tax.

Pleased to see this post is encouraging some LVT supporters to come out of the woodwork!

Anonymous said...

Of course, there is one Conservative who is famous for his support of LVT.

Jock Coats said...

Make up your own minds...the whole article is now online.

To be fair, James, the Bow Group proposal was really LVT, just like us they were trying to find a way of making it possible before there was a full land register - like our proposal for homestead allowance. There's no doubt that the author, Mark Wadsworth, is an LVTer.

Newmania said...

Any new tax is a bad one because its always "and" and never "or".

Anonymous said...

Direct quote from the Bow Group paper:

"Land Value Tax: Council Tax, Stamp Duty Land Tax, Capital Gains Tax on
disposals of land and buildings, Inheritance Tax and the TV licence fee will be scrapped and replaced with a “Land Value Tax” of 1% per annum on the value of all residential properties. The first £70,000 in value per household will be exempt."

That sounds like a property tax for me. To be fair, he does go into the rationale of LVT, but that is his conclusion.

Full paper here.

Anonymous said...

newmania: so we still have residential rates and the poll tax (and the window tax for that matter), then?

Jock Coats said...

No, believe me James, Mark is an LVTer. Their "threshold" was intended to be a similar thing to our "homestead allowance" a sort of "proxy" for building value if you like. We've had lots of discussions with Mark Wadsworth and if you look through any public discussions on the subject (I think there was some at FreeThink and in the web consultation on the Reducing Poverty policy paper) he's been advocating it even on Lib Dem sites (along with Citizens' Income!).

David Curry is an LVT supporter, and I think Steve Norris has been pretty convinced too (particularly from a transport funding point of view) - both have certainly been platform speakers on the subject at LVT conferences and at Labour and Lib Dem fringes.

Newmania - "Georgists" adhere to the idea that LVT should *always* be a replacement tax. Henry George indeed reckoned that governments should be absolutely limited to spending only what they could raise on a Land Tax - hence it is known as "Single Tax".

Newmania said...

Or the clock tax etc....OK no but if the Liberal party were ever allowed to run anything(shudder) and they got their local income tax it would be more so let me restate it as " Different= worse = higher ".
Land value tax has one obvious disadvantage in taxable value is likely to inflate over an above inflation for the foreseeable future and noone ( true to form) will adjust the amount and there would be an in built increase rolling on.
Also it breaks the concept of a charge for services locally which is the only thing stopping local groups of people voting themsleves more of other peoples money as is disastorously the case nationally. It moves towards progressive local tax which is to be resisted. It is the one remaining area where people can actually see that what they vote for might cost somebody something

What do people in flats pay ? Sounds silly on the face of it but no doubt I have missed the point the Bow Group are usually pretty good eggs

Newmania said...

Actually I obviously have missed the point entirely. This begins to sound quite interesting

Newmania said...

James Graham I am browsing through the Bow Group report which proposes radical alteration to the exisiting system. The first thing you think of is the tradiitional Conservative objection to all any innovation which is that the existing system may be working in ways you are not aware of. Raing Corporation tax to the level of Income tax ? Surely comonaies would simply relocate ?

James Graham (Quaequam Blog!) said...

Come on Jock, this is getting silly. The pamphlet states quite clearly that the tax should be based on "value of all residential properties". That is the actual proposal. It is a property tax, not a land value tax. The homestead allowance is a red herring.

Mark Wadsworth may well be in favour of land value tax. But whoever wields the blue pencil in the Bow Group certainly is not.

David Lindsay said...

Nick Brown MP is rightly accusing Newcastle City Council, a Lib Dem flagship, of the "low grade ethnic cleansing" of his working-class constituents, demolishing their council flats and putting up houses to be bought by middle-class Lib Dem voters instead.

But why is this only being reported here in the North East? And how many more of these stories about newly yellow Shirley Porters are there around the country, each being reported only in its own locality, if at all?

Oh, and Dizzy, Hexham is now a three-way marginal, to match the Tory loss of Westmorland and Lonsdale to the Lib Dems, failure to recapture Selby from Labour(!), and near-loss of Beverley and Holderness to Labour(!). In the North, not even the farmers can be relied on to support the Tories these days. Still, keep piling up those enormous majorities in the Home Counties gin-and-jag belts. That's the way back to office, isn't it...?

Praguetory said...

I attacked these Bow Group proposals for being a property tax (and therefore a missed opportunity). I believe that Mark Wadsworth is now fully in favour of LVT. I'll let him know about this thread so he can set the record straight.

Anonymous said...

To put record straight, I am an LVT-er, but it is difficult explaining that LVT relates ONLY to land (not bricks and mortar), so I thought I'd go for a progressive property tax (like in Northern Ireland but with a generous homestead allowance of £70,000 which in most cases will cover bricks and mortar).

The Bow Group did not wield a blue pencil - this (in hindsight wrong) decision was down to me.

For people in flats it is simple - the FREEHOLDER is primarily liable, and he allocates it between himself and the leaseholders pro rata to the market valus of everybody's interest. If the freeholder understates the value of his reversionary interest, then the leaseholders are allowed to enfranchise under Leasehold Refrom Act at that lower value.

I have met Tony Vickers a couple of times, he is understandably livid with the whole LIT idea.