Killer Arguments Against LVT, Not (192)

Here's a round-up of the week's squealing. It's all fish/barrel stuff, so see how many factual or logical errors you can spot:

From HousePriceCrash 21 Jan 2011 (discussing an article in The Telegraph):

Libertas, never one to allow facts or logic to get in the way of a good rant:

3. These people will simply move their main home to another country. Maybe the wealthy will move to Florida where the sun is nicer and there is no State income tax*?

9. The council tax is unfair, period. A tax on property means that you do not own your property. Government will foreclose on your property if you do not pay up, so you are a slave to them to a certain extent and there is no security in your property if your income dries up.

So yes, it is unfair that the rich pay less Council tax, but the proper direction is to get rid of it completely. It is an unjust tax which is particularly harmful to families and those on fixed incomes**.

If Westminster quitted bombing half of the middle east into the stone age and bailing out the mega-rich for slight losses, we could once again fund local government through general taxation, as we did before Thatcher bought in this neo-feudalist serf property tax.***

Jerry doesn't quite understand the way the world works either:

17. ... as usual Mark your arguments are completely opposed to common sense.

In a society with a monetary system (ie not a barter society) you can only tax money. Someone living on a piece of land can only pay your Land Tax if they have income. Your land tax is just a round-about income tax. Because an individual has land, you would impose a tax on them, forcing them to work the land, thereby paying your land tax out of their income.

Where your land tax falls down, and pure income tax succeeds, is for those people who can not produce any income form their small piece of land. They are forced to find jobs elsewhere to pay your land tax, which is effectively a tax on their forced income, but completely unrelated to it. That's why no society today (that I know of) uses land tax instead of income tax.****

* Fact: The property tax on a $300,000 home in sunny Florida is around $3,955 per annum. So the tax on a $3.2 million mansion (equivalent to the £2 million threshold for the Mansion Tax) would be somewhere in the order of $40,000 per annum.

** Logic fail: the interests of "families" and people "on fixed incomes" (which is NewSpeak for pensioners are diametrically opposed). If we do a like-for-like comparison of a family (i.e. mum, dad, both working, and a couple of kids) and the pensioner(s) in the identical value house next door, it must be quite clear that if we scrapped taxes on income and replaced them with taxes on land values, this would be a tax saving for the family and a tax increase for the pensioner(s). Or maybe the family are currently stuck in a flat and the pensioner(s) are still in 'the family home' with two unused rooms; if we replaced taxes on income with taxes on land values, the chances are that the family and the pensioner(s) would swap places, thus ending up with a similar tax bill as before, but the family have the benefit of the larger house and the pensioner(s) have a saving on their heating bills.

*** Fact: Thatcher/Major replaced the older, much higher Domestic Rates which raised around a tenth of all tax revenues with the short lived Poll Tax, which was in turn replaced with the much more modest Council Tax which only raises five per cent of all taxes, and bumped up Employer's NIC and VAT to make up the shortfall.

**** Logic fail. You can re-write that whole bit of gibberish substituting 'rent' or 'mortgage payments' instead of 'Land Tax' and it makes just as much (or as little) sense.
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In contrast, here's a proper professional article showing how to really whip up public opinion:

Vince Cable’s notion of a so-called 'mansion tax' first saw serious conference discussion back in 2009. Since then, and following the formation of the coalition, it’s been repeatedly stomped on by Cameron, Pickles and Shapps, only to pick itself up, dust itself down and schlep on, zombie-like, towards its next kicking.

In its latest form, it’s a kind of hybrid: part council tax super-band, part brand-new wealth tax calculated annually on a property’s value at 1% on the excess above £2 million. So, if your property’s worth £2.2 million, you’ll be asked to stump up £2,000. It’s not clear how often your property’s value would be re-assessed.

Some of the comments are a hoot though, and who should make an appearance towards the end of the thread as it currently stands..?

"It does not follow that people who live in two million pound houses and above have the necessary income to match.

Take the case of a widow, Husband had a very good job, He dies Widow is left with very large house which she can not sell at present or she may be of an age where she does not want to move anyway and why should she or perhaps she has be left to look after five or six children. How does she pay the tax, mortgage the property perhaps, she would not get one at present.

So how does she pay the tax?

I dunno, is that a rhetorical question or is the man indelibly stupid?