Outbreak of common sense in Wales!

Emailed in by John D, from the BBC:

Wales should slash income tax rates to the lowest in the UK, according to one of the candidates challenging Leanne Wood for the Plaid Cymru leadership.

Adam Price said the basic, higher and additional rates could be cut by 9p and business rates and council tax ditched*. New land value taxes on residential, commercial and industrial residential land would fund the changes**, he said...

The Welsh Government is getting more tax powers next April, including partial control of income tax...

In proposals published on Friday, Mr Price said "introducing a National Land Value Tax on residential, commercial and industrial land (agricultural land would be excluded) could generate £6bn at a 3% rate on current values. This would enable us to abolish business rates, council taxes and lower income tax, at the basic, higher and additional rates, by 10p," he said.***

* His proposals don't mention ditching Land Transactions Tax as well, unfortunately.

** On a political level, it is better to say the Land Value Tax would fund those public services which increase land values, which is the fair way to fund them and which in turn would enable income tax to be reduced.

*** Something has got lost in translation here. Rhys ap Gwilym's original proposal worked on the basis of total council tax, business rates and income tax (basic and higher rate) revenues in Wales at £4 bn a year, so the LVT revenues required to replace council tax and business rates, and reduce income tax by 10% would be less than £4 bn, not £6 bn.
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Sobers of course runs with the messed up numbers in the comments, knowing full well that they are messed up. He also ignores the distinction between land value and total value including buildings.

Suffice to say, on a fiscally neutral swap, more than half of people would be better off, as wages are distributed more evenly than land ownership.

Total required revenues from LVT on housing (assuming revenues from LVT on commercial = same as revenues from Business Rates) = £2.7 bn.

£2.7 bn divided by 1.34 million households/homes is average £2,000 per household/home (up from current average just under £1,000), not Sober's wild overestimate of average £4,100 per household/home. So all tenants end up better off; a single earner who owns an average value home earning £22,000 or more; or a two-earner couple which owns an average value home earning £17,000 or more each.