Milking the poor to make the rich.. richer.

[Fivetide 10]

I agree with the need to claw back wealth from the richest. But before we can, first we need to reclaim our state from the corporate dictatorship.

 

And another thing... why do we say we get an energy bill, or an insurance bill, or a phone bill or any other bill? They're taxes, just paid to private companies.

 

Grr. Down with the system!

[chem1st 10]

Not necessarily buy-to-let, but if property is to be rented, somebody has to own it, and if the income from rental is less than the cost of ownerhsip, how can it possibly work?

 

Land should be owned in common.

 

The value of the building is tending towards next to nil. Only improvements of value represent REAL value.

 

The land tax can be paid to the state to be distributed as a non means tested benefit in the form of a citizens income. The only way a landlord should be able to profit, is if he makes an improvement.

 

If he invests in a property and upgrade it, he deserves to make a profit. If he tries to speculate and rent out what already exists - the entire rental value should be seized by the state for the people. He cannot move his land off-shore. He cannot avoid the tax. He is welcome to sell or give away the property, and ensure fair access to the land to our fellow citizens.

 

With access to land our fellow citizens have the freedom to set up multiple types of business. They have the ability to create real wealth.

 

By allowing an unemployed or underemployed WORKER access to land, we can allow for wealth to be created in the first place. The 'previous man' (to para-phrase the colloquial slang for a capitalist of the first degree in t'form of a drug dealer/producer), would thus be able to grow food in the first place, to have a unit in which he could TRANSFORM raw materials into a profit yielding material, in which to build furniture, to assemble various forms of goods etc.

 

It is suicidal for our nation and society as a whole to penalise the poorest in our society and deny them access to land, whilst we subsidise landowners for merely owning land, incentivising them to leave land idle.

[maxmaximus 10]

Yes, everybody who owns land pays tax based on the rental potential of the land. Obviously for owner-occupiers the rate could be lower. For people renting out property as a business they pay more. For people/businesses hogging or under-utilising land they pay way more.

 

It sounds draconian at first. The flipside is that if land tax was collected efficiently then income tax could be reduced so it could reduce the overall tax burden on ordinary people. I'm not very happy that a lot of taxes that we pay are used for housing benefits to subsidise landlords. I'm sure you aren't either. You might counter and say that it would force up rents but the beauty of the punative tax rate on unused and under-utilised land is that it could be used to force that land to be developed, increasing the housing stock which would push down rents and stimulate the economy.

 

So in this scenario two people working for the same company and earning the same wage with one renting and enjoying life’s luxuries and the other buying their own property to give them security in their old age, the one that buy property would pay the most tax, and when they both retire the property owner would no doubt continue to pay tax whilst the other got everything for free on benefits.

 

Slightly different scenario with the one renting earning double that of the prudent property owner, I assume the renter would still pay less tax if they spent all their money on foreign holidays and still get a free ride in retirement.

 

Doesn’t sound that fare to me, and the property situation can easily be solved by banning buy to let and encouraging build to let, banning second home ownership or putting your property tax on second homes.

Shelter is one of the main essentials of life and to tax it is immoral. Second homes aren’t an especial of life so taxing them would be fare.

Removing tax from life’s essentials and increasing vat on the luxuries that only the better off can afford would be fare.

 

---------- Post added 02-12-2012 at 08:06 ----------

 

They're not being penalised. They're making a different lifestyle choice and selecting to own property. Renting property should be cheaper than owning property, at least on a month to month basis. Of course over the long term, even when the land tax is taken into account, the ones who choose to own will be better off through gaining assets. The renters won't. Another spin-off is by keeping rents lower and forcing the housing stock to keep pace with demand then labour becomes more mobile, people can re-deploy more easily to where the opportunities are.

 

Edit: Sorry just to add I'm trying to make a case for NOT taxing wealth. Wealth is an illusory concept anyway and I think any discussion about taxing it is pointless. The LibDems mansion tax idea is idiotic. The rent-generating aspects of the economy are where we should be looking if we are intent on some kind of property/land-based taxation.

 

I would say the renter should pay more tax because they will be entitled to more benefits if they lose their job or retire, the home owner is a much lower burden when they retire because they have no rent to pay, home ownership should be encouraged not discouraged, based on your plans I don’t see why anyone would buy their own house when renting is cheaper and free whilst on benefits or retired. That would leave the problem of who would own all these properties that are being let for less than one could gain by have the same capital in a bank.

 

---------- Post added 02-12-2012 at 08:14 ----------

 

I think on of the reasons buy-to-let spiked was that pensions were going through the floor. Until you can get the pension system anywhere near fair (unless you are a public sector worker or got lucky with a decent company pension) buy-to- let still has a big future.

 

That about sums it up, buy to let was encouraged by government and banks as a way to stimulate property inflation which in turn gave us a short term economic stimulus which eventually led to the crash.

 

They should have encouraged build to let and banned buy to let and there wouldn't have been property inflation and although the economy would have grown much slower the risk of a crash would have been significantly reduced.

 

---------- Post added 02-12-2012 at 08:15 ----------

 

Solution? Reduce the need for land. Have less people in the UK by rounding up the illegals and throwing them out. Then, remove the 'right' to social housing from able-bodied people who have never worked - make them put up with a room in a hostel until they choose to contribute.

 

Hey presto, enough housing, land cost drops, property becomes affordable.

 

you can't say that on SF even though it would work.

Edited December 2, 2012 by maxmaximus

[neepsendlane 11]

With you on that - you can build a nice 4 bed house for around £100k, but to buy one will be closer to £500k - the price of land is wodefully inflated, and that is the crux.

 

Solution? Reduce the need for land. Have less people in the UK by rounding up the illegals and throwing them out. Then, remove the 'right' to social housing from able-bodied people who have never worked - make them put up with a room in a hostel until they choose to contribute.

 

Hey presto, enough housing, land cost drops, property becomes affordable.

The real agenda is now revealed.

[Cyclone 10]

I don't want to profit from land speculation. I would rather we had a system where people were rewarded for hard work, and unearned increases in land values were taxed.

They are mostly, it would be capital gains tax when the land was sold.

 

That doesn't apply to ones primary residence of course.

 

Instead of getting rich quick through speculation, people should get rich through honest graft, they should be entitled to the fruits of their labours. It is very sad to think that one could become rich through speculation or work hard and be poor.

It's not speculation if you already live there is it, it's just chance.

And it's hardly a wealthy area, so if there is any price increase it will be the relatively poor who are benefiting.

I disagree that it will drive prices up at all though, I don't see any evidence of this happening in other places that train stations were built.

 

---------- Post added 02-12-2012 at 09:13 ----------

 

Yes, everybody who owns land pays tax based on the rental potential of the land. Obviously for owner-occupiers the rate could be lower. For people renting out property as a business they pay more. For people/businesses hogging or under-utilising land they pay way more.

 

It sounds draconian at first. The flipside is that if land tax was collected efficiently then income tax could be reduced so it could reduce the overall tax burden on ordinary people. I'm not very happy that a lot of taxes that we pay are used for housing benefits to subsidise landlords. I'm sure you aren't either. You might counter and say that it would force up rents but the beauty of the punative tax rate on unused and under-utilised land is that it could be used to force that land to be developed, increasing the housing stock which would push down rents and stimulate the economy.

 

Land with housing on it isn't really the issue though is it. We want land to be used productively, having a house on land is productive. Owning a huge land bank and doing nothing with it is unproductive and obstructional. If there were to be an LVT it should be levied on unused land. Anything sat in a land bank, anything not cultivated (and not lying fallow as part of a rotation cycle), with the exception of land with the right to roam, brownfield sites (ie peoples gardens), etc...

 

---------- Post added 02-12-2012 at 09:15 ----------

 

They're not being penalised. They're making a different lifestyle choice and selecting to own property. Renting property should be cheaper than owning property, at least on a month to month basis.

That sounds entirely paradoxical.

Someone has to own that property, and if they are letting it then it will be for a profit, so renting should always cost more than buying. Inflation distorts this though.

Of course over the long term, even when the land tax is taken into account, the ones who choose to own will be better off through gaining assets. The renters won't. Another spin-off is by keeping rents lower and forcing the housing stock to keep pace with demand then labour becomes more mobile, people can re-deploy more easily to where the opportunities are.

 

Edit: Sorry just to add I'm trying to make a case for NOT taxing wealth. Wealth is an illusory concept anyway and I think any discussion about taxing it is pointless. The LibDems mansion tax idea is idiotic. The rent-generating aspects of the economy are where we should be looking if we are intent on some kind of property/land-based taxation.

Mansion tax is just an extension of how we already pay council tax based on the value of our homes isn't it?

 

---------- Post added 02-12-2012 at 09:18 ----------

 

With you on that - you can build a nice 4 bed house for around £100k, but to buy one will be closer to £500k - the price of land is wodefully inflated, and that is the crux.

 

Solution? Reduce the need for land. Have less people in the UK by rounding up the illegals and throwing them out. Then, remove the 'right' to social housing from able-bodied people who have never worked - make them put up with a room in a hostel until they choose to contribute.

 

Hey presto, enough housing, land cost drops, property becomes affordable.

 

The fact that they're illegal generally means we don't know who or where they are. Otherwise we would already 'throw them out'.

I think land banks are a big part of the problem, an LVT on unused land would incentivise building companies to either poop or get off the can, figuratively speaking.

 

---------- Post added 02-12-2012 at 09:20 ----------

 

I agree with the need to claw back wealth from the richest. But before we can, first we need to reclaim our state from the corporate dictatorship.

 

And another thing... why do we say we get an energy bill, or an insurance bill, or a phone bill or any other bill? They're taxes, just paid to private companies.

 

Grr. Down with the system!

 

We say it's a bill because you're choosing to enter a contract to buy those services.

Don't want to pay the tax then don't enter a contract and don't buy energy, insurance or a phone. The latter 2 are easily done, energy is a bit more difficult, but there are certainly options today for living off the main grid if you wish.

[carosio 186]

I suspect that the main reason for proposing LVT is not fairness but that its difficult to avoid like council tax, and the fact that the government is skint.

 

I assume LVT would be tax deductible. Who would collect this tax, the councils or government?

[poppins 10]

Home prises has risen rapidly the last two years in the US, the reason is the rich are buying them up just for investments , so young people trying to buy a starter home for themselves don't stand much of a chance .

[Fivetide 10]

We say it's a bill because you're choosing to enter a contract to buy those services.

Don't want to pay the tax then don't enter a contract and don't buy energy, insurance or a phone. The latter 2 are easily done, energy is a bit more difficult, but there are certainly options today for living off the main grid if you wish.

 

Yes, well. I think you made my point for me. It's a monopoly on the supply of goods and services necessary to life. And they charge us more than is decent for the privelige to live.

 

So it's taxes by another name.

[Cyclone 10]

You're including a phone and insurance as a) necessary for life and b) a monopoly? Have you seen how many insurance and phone companies exist?

 

Energy is less competitive, but if you want to avoid the 'tax' then buy some solar panels, install a wood burning stove and insulate your house well.

 

A tax is something that you're required to pay by law, phone contracts, insurance and energy are not taxes and you can choose not to pay for them if you wish.

 

---------- Post added 02-12-2012 at 15:27 ----------

 

Home prises has risen rapidly the last two years in the US, the reason is the rich are buying them up just for investments , so young people trying to buy a starter home for themselves don't stand much of a chance .

 

According to the FRED data they are still falling in real terms;

 

http://modeledbehavior.com/2011/09/26/what-can-texas-teach-us-about-the-great-recession/

[gnvqsos 10]

The trouble is, some people choose over a lifetime to rent property and spend their money on holidays/cars/beer/hookers or whatever.

Others choose to spend it on their property or mortgage - why should the latter be penalised because their income was spent on buying property?

 

You seem to be assuming that renting is an option exercised by the feckless,and that house buyers live like monks This is clearly quite wrong and smacks of condescension.Many renters spend a large % on basics,and many experience fuel poverty.Are you one of those hard working family members I hear so much about on the media?

[Conrod 10]

You seem to be assuming that renting is an option exercised by the feckless,and that house buyers live like monks This is clearly quite wrong and smacks of condescension.Many renters spend a large % on basics,and many experience fuel poverty.Are you one of those hard working family members I hear so much about on the media?

Plenty of house buyers live very carefully so they can save for deposits then keep up with their mortgages - that's a lifestyle choice they make to provide for their family securely.

 

And, while I don't dispute that there are plenty of people in rental who stuggle without wasting their money, there are also plenty of council houses with nice cars on the drive and families who get a few holidays each year. Lifestyle choice again.

 

And, as it happens, I do work fairly hard.

[gnvqsos 10]

Plenty of house buyers live very carefully so they can save for deposits then keep up with their mortgages - that's a lifestyle choice they make to provide for their family securely.

 

And, while I don't dispute that there are plenty of people in rental who stuggle without wasting their money, there are also plenty of council houses with nice cars on the drive and families who get a few holidays each year. Lifestyle choice again.

 

And, as it happens, I do work fairly hard.

 

How do you know people are council tenants-many such houses have been traded since the law allowed tenants to purchase.You do seem rather envious.By the way the cars may belong to the working children.