Yesterday’s launch of Labour’s Land for the Many report – see link below – sets out radical policies which if implemented would have far reaching consequesnces for many land owners, home owners and buy-to-let landlords.
The report by lead author George Monbiot, Guardian columnist and the author of “Feral, The Age of Consent and Out of the Wreckage: a New Politics for an Age of Crisis”. Mr Monbiot says in a recent article for the Guardian, “Want to tackle inequality? Then first change land ownership laws.”
Among the many proposed reforms: publishing all information about land ownership – “who benefits most from our current unequal arrangements” – giving councils the power to sell vacant land by public auction, local planning juries, and boosting democratic participation in planning processes. Plus lots of other radical proposals, all aimed at “delivering a fundamental shift in wealth and power from the few to the many”. All of these proposals says Labour will be considered for inclusion in the next Labour Party manifesto.
Ending the “Buy-to-let frenzy”
Chapter 3 of the report recommends major reforms of the private rented sector, for example, tenancies would be open-ended, and landlords would lose their power to evict a tenant who has not broken the terms of the tenancy agreement for the first three years of the tenancy agreement, and would have to provide grounds for eviction after that point.
There would be a cap on annual permissible rent increases, at no more than the rate of wage inflation or consumer price inflation (whichever is lower), and Buy-to-let mortgages would be more firmly regulated and restricted.
There would also be a commitment to an ambitious social house building programme, and there are suggested changes to the system of land assembly and community ownership. It is recommend that the Land Compensation Act is reformed to enable development corporations and other public authorities to acquire land at prices closer to its “current use value”, rather than its potential future residential value. This, says the report, could reduce the cost of building genuinely affordable housing by up to 50%.
“Progressive and efficient tax reform”
To discourage “the use of homes as financial assets”, reduce the tax paid by the majority of households, and encourage more efficient use of the housing stock, the report urges a Labour government to replace Council Tax with a progressive property tax. This would be payable by owners, not tenants.
The valuation of properties for tax purposes would be updated annually, and empty homes and second homes would automatically be taxed at a higher rate. It is also recommending a surcharge for all properties owned by those who are not resident in the UK for tax purposes.
Stamp Duty Land Tax would be phased-out for those buying homes to live in themselves, and capital gains tax for second homes and investment properties would be increased. It is recommend by this report that inheritance tax would be abolished, to be replaced with a lifetime gifts tax levied on the recipient.
Business rates would be replaced by a Land Value Tax, calculated on the basis of the rental value of local commercial land, and farmland would be reserved for farmers only to prevent it from being used for tax avoidance and speculation we proposes – a new English Land Commission would review all tax exemptions given to landowners. The aim would be to “restrain fiscal privileges without harming family farms.” The removal of similar tax exemptions on woodlands and forestry would also be considered.
An Offshore Company Property Tax would be payable by companies based, or beneficially owned, in secrecy jurisdictions. The report also recommends that an increase in the Annual Enveloped Property Tax and a removal of the exemption for properties under £500,000.
Land for the Many report