Monday, 14 January 2013

Killer Arguments Against LVT, Not (301)

UK Liberty at Liberal Conpsiracy, rebuts the baseless claim that there would be endless appeals and/or that [relative] valuations are impossible thusly:

On valuations, some figures from Denmark, where they have LVT, property tax, and service tax:

5m inhabitants
43k sq km
1.9m properties
valuation staff:
Central office - 16
8 regional offices - 150 total
7 regional appeal boards - 20 total
7 appeal secretariats - 25 total
= 210 staff

appeals of 2002 valuation:
39k appeals or 2.05%
6k to regional board or 0.31%
310 to national board or 0.02%
10 to court system (can only do this on questions of law)
- Development of Danish Land Valuation PPT

See also Property Valuation and Taxation in Denmark

Or, closer to home, the UK has Business Rates, which is a lot like LVT but the valuations are more complicated because they take the bricks and mortar into account and Council Tax, which is/was a fairly crude banding exercise. :

The work of the VOA encompasses:

• compiling and maintaining lists of rateable values of the 1.7 million non-domestic properties in England, and the 100,000 in Wales, to support the collection of around £25 billion in business rates; [that's an average Business Rates bill of £14,000]

• compiling and maintaining the lists of council tax bandings of some 23 million domestic properties in England and 1.3 million in Wales, to support the collection of around £26 billion in council tax;

According to page 66 of their Annual Report 2011-12, they have just under 3,000 employees keeping all those valuations up to date.

Under proper LVT, valuations for commercial land and buildings would be a lot simpler but valuations of residential would have to be a bit more sophisticated because there would be more bands (at least twenty or thirty), broadly speaking the workload wouldn't change much (it can all be computerised, everything can be indexed up from year to year, and so on).

The VOA's total running costs including salaries, IT and so on are about £200 million a year, i.e. 0.4% of tax collected; and only about two or three per cent of Business Rates and Council Tax go uncollected. That's not absolutely brilliant, but far, far better than for any other taxes (collection costs approx. 1% and evaded and unpaid taxes about 10%).

The Valuations Tribunal deals with appeals against Business Rates and Council Tax valuations. There were 180,000 appeals against Business Rates valuations in 2011-12 (that's one-in-ten valuations, but three-quarters were agreed within the year) and 2,040 appeals against Council Tax bandings (that's one-in-twelve thousand bandings), see page 7 of their Annual Report 2011-12. The Tribunal employs about 80 people.


Lola said...

Or in other words, tens of thousands of HMRC staff are already redundant - they are on benefits.

Mark Wadsworth said...

L, HMRC isn't so bad, it appears to have fewer than 100,000 direct employees. Heck know what they spend/waste on outsourced IT projects though.

Lola said...

MW, well that's probably 80,000 too many (the old 80:20 rule), and certainly implementing LVT would see that 80% down the road...

Graeme said...

does that mean that Bob B will stop bleating about rates tribunals?

Graeme said...

even worse...I see that Bob B is now afraid that London is not paying its fair share of tax so LVT will raise the tax burden on London....does he have no shame?

Mark Wadsworth said...

G, no, Bob is a Homey, they have no shame.

But this blogging is a spectator sport, neither DC, UK Liberty, Nutty, Thoughtful nor I have the slightest hope that we can allay Bob's "worries" about LVT, the point is that plenty of people read these debates for entertainment value and some of it might rub off on them.

Surely they will recognise the pattern:

Homey makes some claim or other
Georgist rebuts it patiently, with facts and logic
Homey ignore that evidence, makes up another claim
rinse and repeat

Graeme said...

I am amazed...Bob B is still digging his hole. Now he is repeating arguments that have already been dismantled.

Bayard said...

G, these people obviously don't think, they just repeat arguments parrot fashion. If they are not intelligent enough to realise when an argument has been dismantled, they are not intelligent enough to make up the argument in the first place, therefore they are just saying what someone has told them to say, but who is that someone?

Mark Wadsworth said...

G, B, I don't think it is anyone in particular directing this, it is just a mass delusion gently encouraging by the vested interests and willingly swallowed by the Homey foot soldiers.

e.g. although most people claim that they don't believe a word which the politicians say, they merrily parrot the Morbidly Obese One's claim that a full Council Tax revaluation would cost a shocking £280 million (£10 per home) or Osborne's claim that such a revaluation would involve an army of inspectors forcing their way into each home.

That said, we do not know whether Bob B is in fact a paid employee of some large landowner whose job it is to clog up the internet with all this shite.

Bayard said...

I was just trying to put the "Conspiracy" into "Liberal Conspiracy"....