TSW Commission recommendations on Land and Property

[Purple]

Chapter 14: Land and Property
14.1 The Commission recommends the introduction of a Site
Value Tax (SVT) on all land currently not subject to
Local Property Tax. This includes all commercial
(developed and undeveloped), mixed-use, agricultural,
undeveloped zoned residential lands, and State-owned
lands as well as all land on which derelict and
uninhabitable premises sit. SVT should replace the
existing system of Commercial Rates over time.
14.2 The Commission recommends that there should be
differential treatment in the application of Site Value
Tax to agricultural land.
14.3 The Commission recommends that the current structure
and broad features of Local Property Tax should remain.
This includes a market value basis for applying the
charge, keeping exemptions to a minimum and the
continued use of regular revaluations.



There is a general emphasis on reducing taxes as a proportion of the overall tax base on wealth creation and increasing taxes on wealth retention. That is certainly to be welcomed.
A site value tax is also a good idea.

These recommendations are also in line with an overall emphasis on broadening the tax base and minimising exemptions.

 

[ryaner]

If done correctly, the SVT could and probably should replace the LPT too. There are winners and losers to both approaches and the LPT is more understandable to average people though. I am surprised they aren't directly recommending the amount be increased.

 

[Sophrosyne]

They are.

This is the full list of recommendations:



14.4 Revenues deriving from Local Property Tax (LPT) should increase to form a substantially larger share of total revenues through the adjustment of the basic rates of taxation and potentially through an adjustment of valuation bands. The ability of local authorities to decrease the basic rate of LPT should be removed.

14.5 The Commission recommends that, in the case of multiple property owners, a Local Property Tax surcharge should apply to properties not occupied as the principal private residence of the property owner or a registered tenant.

14.6 A Local Property Tax surcharge should be introduced for vacant properties.

14.7 The Commission recommends that tax incentives should not be used in order to stimulate the supply of housing.

14.8 The Commission supports the reform of the differential rent schemes towards a national system based on ability to pay. Any proposed changes to social housing supports should fully consider the potential impact on incentives to work.

14.9 The Commission recommends that the tax system should be neutral in its treatment of different tenure types.

14.10 The Commission recommends that the Help to Buy scheme be allowed to expire as planned at the end of 2022.

 

[Brendan Burgess]

14.9 The Commission recommends that the tax system should be neutral in its treatment of different tenure types.

14.7 The Commission recommends that tax incentives should not be used in order to stimulate the supply of housing.

Not sure about this and I will read the chapter in detail.


Why should government policy not be to encourage home ownership as the best way to build a cohesive society?

And there is a real problem with the supply of housing. From an ideological point of view, I agree with less government intervention. But we need house building.

And the government discourages house building with VAT on new houses, imposing a social housing burden on buyers of new houses and imposing development charges on them. And of course, very high standards which also add to the cost of building houses.

Maybe scrap all those disincentives and then scrap the incentives as well.

Brendan

 

[Sophrosyne]

The Commission explains its rationale in Chapter 14 (Land and Property) and also in Chapter 5 (Balance of Taxation) and Chapter 7 (Taxes on Capital and Wealth).