Friday, 21 December 2012

Killer Arguments Against LVT, Not (294)

Ben Jamin' in the comments to an earlier post:

LVT is supposed to be unavoidable, what about Gypsies? I'd like to see you give them an LVT bill. Good luck with that one.

Easiest thing in the world. LVT is just ground rent. We know that:

a) The general public has certain sort of prejudices against gypsies, be they justified or otherwise, and they want gypsy camps (settlements?) to be as far away from them as possible.

b) Gypsies on the other hand would probably prefer, all things being equal, to be closer to rather than further away from urban centres, because they have to go shopping etc just like anybody else.

c) Mainly, gypsies want to be left in peace and quiet, and they are prepared to pay for this.

So it's up to each town to identify a suitable site and offer to rent it to gypsies (who have their own clans and family structures, impenetrable to me). The closer that site is to the town, the higher the rent will be (the town's residents will want 'compensation' and the gypsies will be happy to pay more), and the further away it is, the lower the rent will be (for equal and opposite reasons).

So the rent the town's residents would demand for a field right next to the town would be £100,000s a year, and the rent they would demand for a field which is three miles out of town might be only £10,000 a year. By applying usual market forces and a kind of bidding-auction process, we will find some sort of optimum, maybe it's a field one mile out of town and the rent is £30,000 a year.

So our thirty (or whatever) gypsy families agree to pay £30,000 a year rent for that field, chipping in £1,000 a year each. If they don't pay, they get moved on, but seeing as they agreed to pay this, why would they not pay?

There, that's your LVT (aka ground rent) collected. We can also assume that at least some of those gypsies will be legally resident UK citizens entitled to their Citizen's Dividend. The adult-rate CD would be about £3,500 - £4,000 per year, so as long as ten or more of them are entitled, their LVT bill and CD entitlement can be netted off, no money actually changes hands.


mombers said...

The amazing thing about several KLNs is that it is objectionable that people have the option to pay no net tax regardless of their income. Generating income is a Good Thing, so why should someone who is good at it have to carry everyone else? And the chances of many high earners suddenly deciding that they want to live in shoeboxes in Scunthorpe are less than bugger all anyway.

Mark Wadsworth said...

M, exactly. Even under current rules, high earners could save themselves a fortune by renting or buying a shoebox in Scunthorpe instead of a footballer's mansion in Cheshire or a townhouse in Chelsea, but mysteriously, they don't. They could also cut their car tax by using the bus instead of buying a new BMW, go figure.

Bayard said...

M, one word answer: envy.

Mark Wadsworth said...

B, does even the most hardened Mail reader envy Gypsies? They are perfectly entitled to sell their houses, buy caravans and club together to rent their own field in the middle of nowhere for £1,000 per caravan per year if they want.

Not the life I'd choose right now, but if I found some like-minded nutters and wanted to 'drop out', then why not?

Robin Smith said...

Won't happen.

Gypsies, like the rest of us, are rent seekers at heart. There will be an over arching landlord among them... opposing the idea with all their strength.

Bayard said...

Mark, I wouldn't think they would envy Gypsies, I was answering the question: "so why should someone who is good at it have to carry everyone else?"

Ben Jamin' said...

My very own KLN. Fame at last!!!

Andrew Smith said...

So that would be a ghetto, right?

Anonymous said...

OK, if they are eligible for the CI and they occupy a site less valuable, then there's no problem, but I thought the point was that they won't agree to pay but stay anyway. Then when the police try to move them on they will claim some sort of rights are being infringed.

Bayard said...

J, the main point is: who wants to live on or near a Gypsy site? No-one except Gypsies. Who wants to have a business on or near a Gypsy site? Ditto. Thus the rental value of Gypsy sites is even less than farmland, therefore they wouldn't attract any LVT. I would have thought that, given the prejudice against Gypsies, Gypsy sites represent the LVT baseline, the sites with the least possible location value, if not negative location value.

Mark Wadsworth said...

RS, righty-ho. I've never heard gypsies complaining about having to pay rent for their sites.

BJ, I wasn't going to do the one with the Tardis or living underground, but I'd heard this one before so I thought I'd do it.

AS, if they choose to live on campsites, why is that a ghetto? They are perfectly entitled to buy houses if they like.

J, yes of course non-payers will think up all sorts of excuses, but ultimately, if people don't pay then they have to be moved on/out, just to serve as an example.

B, most people wouldn't want to live on a gypsy site, but that does not mean it has negative value to them. It has positive value to them and that is what they pay for.