Tuesday, 7 December 2021

Something else that LVT would sort out:

Up in north Wales, local people are feeling aggrieved that mobile home and luxury caravan owners aren't paying enough council tax.

However, a brief glance at the article reveals that the problem is really that the owners of the land on which the luxury mobile homes and caravans sit are not paying enough in business rates. Now if only there was a way to roll up council tax and business rates into a single tax based on the rentable value of the land....


Mark Wadsworth said...

From the article:

"Yet while their owners usually pay the parks an annual fee of several thousands of pounds, including a contribution to the overall business tax bill, Cllr John Brynmor Hughes believes that existing regulations should be amended and that their owners should contribute more to council coffers and be themselves liable."

Cllr Brynmor is a badly informed wanker.

The park owner pays Bus Rates to the self-same council! And Bus Rates are usually a lot higher than council tax.

The legal liability does not affect the incidence of the tax either, not that it makes the slightest bloody difference as far as the council is concerned.

Lola said...

What's more the owners do not pay 'part of the business tax bill' they pay all of it...Where else can the Park get the money from?

Wanker squared?

Mark Wadsworth said...

L, haha, well spotted. Tax incidence.

Bayard said...

For a single property, yes, but, in a case like this, with multiple properties on the same site, I doubt it, the problem being that Council tax and business rates include an element of tax on the brix and mortar. The Park owner doesn't have any bricks and mortar to tax. Also band A properties, which these mobile homes would be, are proportionally the most heavily taxed under the council tax regime, so lots of cheap properties pay a lot more tax than one expensive one of the same value.

L, this is the thorny problem of who "pays" for what. I would have thought that the rent the mobile home owners pay is irrespective of the rates that the Park owners pay. If the council suddenly gave the owner a rates holiday, would he pass on the saving to his tenants? I very much doubt it. Even if he did, he would only be passing on a proportion, as he believes that they are only paying a proportion of the tax. Conversely, if the council put his rates up, as they should, he is not going to be able to pass this on to the mobile home owners who will already be paying the maximum the market can bear. Thus it is the landowner who pays the business rates. See also the argument "the NHS isn't free, I pay for it out of my taxes".

Mark Wadsworth said...

B, I think we are at cross purposes here.

Assuming site is profitable overall...
a. The caravan owners pay full site rental value + value of services to landowner. I think this was L's point.
b. Landowner pays part of site rental value to the council. Fact, unless he is hideously over-assessed.