Monday, 16 September 2013

Common Sense?

On R4 this morning I actually heard the Cleggster say something almost sensible.  No.  Really. He did.

He sayeth, in response to a question about Mansion Tax, something on the lines of 'we think that it is a good thing to reduce taxation on labour and enterprise and increase it on property and wealth'.  Now we know he's a bit confused about the factors of production and 'wealth', but really that is pretty good for the Cleggster.

And then I read BoJo's piece in the Telegraph.  The first bit of which is 100% ignorant home-owner-ist.

And then I read this at the Adam Smith Blog. (Penultimate paragraph)

This got me thinking about and reading up on - when I should be working - Citizen's Income.

Combining CI with, or if you prefer funding CI from, LVT is so shatteringly sensible it is impossible to see why anyone objects to it.

The beauty of combining the two is that it makes clear that a large part of rent - the location value - is just privatised taxation.

It's a genuine example of commonsensical joined up thinking.

Does that make it doomed?


Ben Jamin' said...

Joined up thinking? Seriously, how likely is that?

As MW will confirm, when netted off against each other 3/4 of households would have no LVT liabilities.

Left with only a flat 20% tax on incomes to pay, the typical household will be paying £8000 less to the Government overall.

What's not to like? F**k knows, but I suspect the only way this will ever happen is when the YPP win at the next general election.

Lola said...

BJ - let alone all those lovely bureaucratic jobs thats will go, instantly. Oh. Hang on? Ah. Hmm. I see a difficulty...

The Stigler said...

I think the connection is something like this:

The people who want to grab the most from the state (living near Railway stations, near government offices) have to pay (in LVT) the rest of us for that privilege (in CI).

Mark Wadsworth said...

Yes, agreed.

The more taxes and benefits or allowances can be rolled into one and netted off at source, the better.

Clearly, LVT is better than flat rate income tax, but flat rate income tax in turn is better than tax + NIC + VAT.

I think it was DWP officials who torpedoes IDS' universal credit idea, they went out of their way to make it as complicated as possible for fear of losing their lovely jobs.

TS, agreed.

Clearly, with any tax system, high income people have to pay into the system and low income people are the net beneficiaries. That's sort of the point.

But with income tax, the high earner/high payers get nothing back in return for the tax they pay.

With LVT, the high earners/payers get somewhere nice to live. The low income people fulfil their part of the bargain by living in the cheaper areas.

I really can't see any sort of moral problem with this.