A compelling case for LVT
Dominic is a lively explainer. Previously I read his 2014 book on Bitcoin. This time he’s doing the story of taxes right back to the dawn of civilisation.
But
it’s what Dom has to say about Money and Land that is most interesting. Yes,
Land Value Tax crops up right at the start when he tells us why Hong Kong is
such a low-tax entrepreneur’s paradise.
But
on p144 Dominic pulls out a real gem
“Many
people blame high house prices on lack of newbuild, and population growth. But
in the 10 years between 1997 and 2007, though the population grew by 5%, the
housing stock grew by 10%. (ref to Positivemoney). If house prices were a
simple function of supply and demand, they would have fallen slightly over the
period. Instead they tripled.
“Mortgage
lending over the same period went up by 370% — a commensurate amount. It was
the increased supply of money, through the issuance of debt, that caused house
prices to rise.”
Brilliant!
He gets it!
Only
in the last chapter does Dominic make the case that the only way tax can work
in future is by Land Value Tax. Like me, he doesn’t like this label.
Instead
he calls it L U T — Location Usage Tax. [I’d coined Plot Value Charge
for the same thing].
There
follows an impassioned, but pretty standard case for LVT/LUT/PVC.
Missing,
sad to say, is the By What Means? Question. How do we get there? Where do we
start? The 1909 People’s Budget was shot down by politics.
“But
this is Utopia” says Dominic. [No need to answer these difficult yet vital
questions!]
A
highly commendable effort. A great read, with some real gems.
Read
it, you’ll like it.
Full
ref: Frisby, Dominic (2019) Daylight Robbery: How tax shaped our past
and will change our future UK; Penguin Business
