Cheers Todd
I welcome the interest your Victoria Transport Institute of Canada has in
land value capture.
1. A first reading of your Online TDM Encyclopaedia entry on land value
capture indicates to me that you are examining the split-rate tax rather
than pure Land Value Tax (LVT) which would not include any element of taxing
capital improvements (i.e. buildings).
2. You may wish to check the accuracy of the reference to Pittsburgh,
Philly, USA, as my understanding is that this City has now dropped the
split-rate tax. I'm not sure of the reasons but believe that it was possibly
because of a long period between re-valuations of site values leading to
some landowners facing large increases in their tax bills and all Mayoral
candidates promising to drop the tax - but someone in Philly might care to
confirm this to you.
3. I welcome your inclusion under "Best Practices" - "Consider implementing
a split-rate tax to reduce the costs of redevelopment within urban areas".
Of course, this is only one effect of taxing land values. Land Value
Taxation will also:
- help avoid urban sprawl and all the extra transport and infrastructure
costs that entails.
- encourage investment into productive enterprise and housing rather than
sterile land speculation.
- reduce the cost of acquiring land.
- return increased land wealth to the community that creates it.
- provide a tax revenue that is cheap to collect and impossible to evade.
- encourage empty sites to be brought into use where planning permits.
- encourage banking authorities to set lower interest rates without
encouraging a land price bubble which will stimulate the extreme booms and
slumps of the business cycle.
- enable Governments and/or local authorities to reduce other taxes which
act as a drag on the economy instead of the incentive for economic growth
offered by LVT.
- provide automatic compensation to those landowners who see a reduction in
their site value because for example, the noise and pollution from a new
road bordering their property devalues their landholding.
4. Re TDM "Land Use Evaluation" I tend to disagree with one item in the
summary attached.
Namely "Automobile oriented transportation tends to increase the footprint
of transportation facilities and encourage sprawl. These tends to: Reduce
land costs, allowing larger building footprints and lawns."
Why reduce land costs? Maybe for the individual car commuter you could
argue that it is cheaper to buy land and build a house with a pool and lawns
etc. on a road twenty miles from town rather than a site close to the centre
of town. But for the owner of the piece of land on a new highway, twenty
miles from town - he/she will see their land value escalate as it changes
from agriculture use say to residential even though the new value is nowhere
near as much as they would have received if their site were closer to town.
I hope these comments help.
Dave
Dave Wetzel
Vice-Chair, Transport for London
Windsor House. 42-50 Victoria Street. London. SW1H 0TL.
Tel: 020 7941 4200. Fax: 020 7941 4748
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