Showing posts with label Land. Show all posts
Showing posts with label Land. Show all posts

Sunday, 29 March 2020

Taking Back Control of Our Land

Land for the Many: Changing the way our fundamental asset is used, owned and governed. (An independent report commissioned by the Labour Party. Read in full at https://landforthemany.uk/)
This is my summary based on a column by George Monbiot.

Land in the UK is now in the hands of a small number of people. This has resulted in increasing inequality and exclusion, high cost of renting or buying a home, the collapse of wildlife and ecosystems, repeated financial crises and the loss of public space.

Since 1995, land values in the UK have risen 412% and accounts for 51% of the UK's net worth. Successive governments have used tax exemptions and other advantages to use the ground as a speculative money machine. A Tax Justice UK report (2019) reveals that by owning agricultural land, 261 rich families escaped £280m in inheritance tax in 2015-16. With farmland being used as a tax shelter, farmers are being priced out.

The value of agricultural land can rise 250-fold when planning permission is given and the owner gets to keep most of it. We pay for this with higher rents and mortgages. Capital gains tax is lower than income tax, and council tax is proportionately more expensive for the poor than for the rich. The land under homes now accounts for 70% of their price. Rather than save for three years for a deposit, the average family now needs to save for 19 years. Housing costs take 36% of household costs for renters and 12% for those with mortgages.

We wrongly blame immigration, population growth, the green belt and red tape, when the real culprits are the tax and financial advantages for landowners and building companies, and the shift in bank lending to the housing sector. These issues are also responsible for the loss of public spaces in cities, limited right to roam, lack of allotments and farmland, and impact on the environment.

The six experts who wrote the report propose the following.
  • Replace council tax with a progressive property tax payable by owners, not tenants.
  • Empty homes automatically taxed at a higher rate.
  • Inheritance tax replaced with a lifetime gift tax.
  • Capital gains tax on second homes and investment properties should match or exceed the rate of income tax.
  • Replace business rates with a land value tax, based on rental value.
  • A 15% offshore tax should be levied on properties owned through tax havens.
Also:
  • New public development corporations should work with local authorities to assemble the land needed for affordable homes and new communities.
  • Builders would compete on quality, rather than amassing land banks.
  • These public corporations would use compulsory purchase to buy land at agricultural prices (not those artificially raised by planning permission).
  • A community participation agency to help people (not big companies) become the driving force in creating local plans and infrastructure.
  • A new definition of public space, with legal right to use.
  • Tighter rent and eviction controls.
  • Compulsory sale orders to bring vacant and derelict land onto the market and give community groups first rights to purchase it.
  • Set up a new body - the Common Ground Trust. When people can't afford to buy a home, the Trust could purchase the land, and they pay only for bricks and mortar (about 30% of the cost). They then pay the Trust a land rent.

Source: Landfall by George Monbiot, 12 June 2019. https://www.monbiot.com/2019/06/12/landfall/

Sunday, 19 January 2020

Watling Street

Watling Street: travels through Britain and it's ever-present path, by John Higgs (Weidenfeld and Nicolson, 2018)

An interesting look at British history through a journey following Watling Street from Dover in Kent to Holyhead on the Isle of Anglesey in north Wales. On the way the author records some interesting facts and muses on the way geography and history intersect. The following sections were illuminating.

National identity or nationalism? We all project our own views onto national identity - thus both David Cameron and Jeremy Corbyn can appeal to 'British values' but actually mean different things. This is not confined to Britain: when you try to pin it down, it becomes vague, and it changes over time. It draws on specific parts of our history and ignores others, and so manipulates people. National identity can also 'lead to the drug of nationalism .... where the land of our own kin is viewed as self-evidently superior while the homelands of others are automatically inferior, and the result of this is a rush of pride ...like other addictive drugs the user of nationalism gradually requires greater and greater doses to achieve the same hit of pride'. In itself a sense of pride is valuable, but for self-worth it needs to come from our own actions and relationships, and not because some long-dead person did extraordinary things. 'If history teaches us anything, it is that nationalism never ends well.'

The Celtic Calendar While we now need more detailed calendars (when are the school holidays, when must I do my tax return) the old calendar breaks the year into chunks of about six weeks, each separated by a party, that describe the yearly cycle of the seasons. The eight festivals comprise the four quarter days bays on solar events, and four cross quarter days, the mid points between each pair of quarter days. We still have events which typically take place around these dates. [A solstice is a period of three days. In winter the shortest day is on 21st Dec. (the winter solstice, Yule, 20 to 23 Dec.) This is followed by Imbolc or Candlemas on 2nd Feb. The spring equinox (Ostara) falls between 19 and 22 Mar. The next midpoint is 1st May (Beltane), then the summer solstice (Litha, 19 to 23 Jun). Then the midpoint of 1st Aug. (Lammas, which celebrates the grain harvest), the autumn equinox (Mabon) falls between 21 to 24 Sept and is the time of harvest festivals, and the final midpoint is Samhain (Halloween) on 1st Nov.]

London. In the wider country, 'it is often seen as a place of the self-obsessed and the privileged, where wealth erodes normal human decency and empathy is scarce'. But those who end up in London find that people are essentially the same - it is just that there are many more of them in a small area. The population of London (2017) is more than the combined populations of Scotland and Wales. Increasing population density increases the number of connections between people and in turn increases economic activity. Businesses find customers and artists find audiences. More ideas, more options. 'The culture it generates spreads to rest of the country and around the globe. The wealth that this generates is supposed to spread to the rest of the country as well, although in practice a large chunk of it does seem to find itself in offshore tax havens.' This one city generates 22% of the UK GDP and pays 30% of UK taxes. Early indications of the implications of the 2016 referendum are that London's financial sector will get much smaller with euro-denominated services move elsewhere. This could lead to a collapse in the 'overheated' luxury property market, which in turn could affect London's general housing market and a knock-on effect on the broader economy.

Land ownership in the UK is not always easy to identify. The Land Registry Act of 1925 was intended to become a complete record ownership of land but as of July 2012 had only managed to register ownership of 80 per cent of land in England and Wales. Registration is only compulsory when land and properties are sold, and technically the remaining land has not changed ownership since 1925. Complicated trusts allow ownership to remain in families for generations - without incurring taxation.

While the European Union Common Agricultural Policy, which accounts for 40 per cent of EU spending, is intended to support food production, you do not need to produce food but have land which is in condition to be farmed. The more land you own, the more money you receive.

There is a finite supply of land, and demand is greater than supply. High prices for farm land mean it is difficult for young farmers to buy. Builders can make money by buying land and not building homes on it, and supermarkets and chain stores have bought parcels of land in order to prevent competitors setting up to close to their own stores. This is one of the reasons for the current housing crisis.

Political attempts to reform the situation have been few and unsuccessful, due to the power of the landed gentry. The post-war Labour government created the NHS and the modern welfare state, but was unable to carry out its planned land nationalisation, instead creating the Town and County Planning Act of 1947. This was 'whittled down' by the 2015-2016 Coalition Government.

JH suggests that the UK adopt a Land Value Tax, variations of which are used by many countries including Australia and Denmark. LVT makes the land market more stable and efficient. It is both less bureaucratic and a difficult tax to avoid because you can't hide land, and is broadly supported by voters who view it as a fair tax.

'Those who own land pay a yearly tax, which is based on the amount of land they own and not hoe it is developed. The fee is based on the local market price of the land, which would encourage economic growth and land use in the north, where land is cheaper. The idea is to prevent people hoarding land to pass down to as yet unborn [descendants] and instead make it available for those who need it now, such as young farmers.' JH goes on 'the LVT would replace other taxes, such as income and inheritance taxes, rather than being an additional tax. It would be eased in, small at first, but it could ultimately become a significant source of government income.  It would also have a psychological effect, by eroding the belief that someone owns the land, and reminds us that we are only using it'.

Due to the power of the French farmers, reform of the EU Common Agricultural Policy is unlikely. Taking CAP money is viewed differently from taking money from the UK taxpayer - but it is our money that goes into that pot. Paul Dacre, editor of the Daily Mail, received £460,000 from the EU between 2011 and 2016 for his ownership of a Scottish grouse-shooting and fishing estate, plus a second estate in Sussex. The CAP was absent from the UK/EU referendum coverage; the few who benefit from our land laws have a disproportionate voice in politics and the media.

Private education. A survey published in 2015 found that the 7% of the population who were privately educated made up 61% of the top doctors, 50% of the cabinet, 48% of the senior civil service, 74% of the top judiciary, 51% of leading journalists, 88% of the senior military officers. This influence now extends to the creative arts, with 42% of British BAFTA winners, and 19% of Brit Award winners having attended selective schools. The privately educated graduates also earn an average £4,500 a year more than their state educated peers after just three years in the workplace.

END