The government has for some time been concerned about the windfall gains that accrue to landowners following planning consents. It has also been hoping to try to increase the supply housing, especially in London and the South East, and to this end appointed a committee chaired by Kate Barker, with the idea that they would come up with suggestions. After several years of deliberation, Barker proposed a "Planning Gain Supplement" (PGS), a levy on the difference in land values before and after the consent had been granted. There was severe criticism from various experts who pointed out that something similar had been tried three times before, and failed. Land value taxation was put forward as an alternative means of collecting not just land value enhancements following planning consents, but of land value in its entirety.
But the PGS met with approval from the government and more consultation followed.
Now the proposal has been dropped. How much has all this cost? And should landowners be able to pocket the increased value resulting from a decision by a committee charged with protecting the public interest?
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