The Lyons Inquiry into local government finance, which reported last week, is probably the most thorough since the Layfield Inquiry which reported in 1976. Submissions were made to Layfield, putting forward the case for land value taxation (LVT) but the final report argued that LVT was incompatible with the operation of the Development Land Tax (which was repealed a couple of years later). This cleared the way for LVT but the mental blockage remained. And now another Inquiry has produced its report. LVT advocates have made their submissions, and were invited to give oral evidence. And this is what Lyons has to say on the subject. ==================================== Chapter 6 (funding reform):- Taxation of economic rent 6.42 Most economists would agree that there is a strong case for levying taxes on land. Land is in fairly fixed supply, and much of its value will therefore be what economists call ‘economic rent’, which can be taxed without altering the incentives to use the land. The ...
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