The Fair System to replace Council Tax – Annual Ground Rent (AGR)

imagesThe Commission on Local Tax Reform was established jointly by the Scottish Government and the Convention of Scottish Local Authorities in 2015 to assess the evidence that would enable a decision to be made on a new system to replace the Council Tax. Since its inception in 1993 the Council Tax has been based on 1991 house prices and was described as “not fair, progressive or locally empowering”.

In the invitation to download its Final Report, the Commission on Local Tax Reform says, ‘The current system of Council Tax must end.’ The Commission is unable to decide what should replace the Council Tax because ‘there is no one ideal local tax.’ The best it can do is suggest that the political parties select, from the three options considered in its deliberations, a ‘broad based’ system of local taxation in preparation for the elections in May.

There are, in the Report, several references to ‘fairness’, ‘progression’, ‘stability’ and ‘efficiency’ which might indicate criteria by which a suitable system of taxation could be judged but there is no mention of their relative merits or importance.

The Commission failed to comment on the most important feature of any tax or charge- it should not hinder employment or trade and so reduce the total fund from which the tax or charge must be paid. The second in importance is that, for fairness, the amount of tax or charge levied is related to the ability to pay and for justice, earnings should not be taxed whilst any unearned rental income is left untaxed. Thirdly, a tax or charge should be cheaply and easily collected, so that the costs of administration are as low as possible. The fourth feature is that there should be no opportunity for avoidance or evasion.

The analysis by the Commission of the merits and disadvantages of three taxes:- Income Tax, Council Tax and Land Value Tax, clearly shows that the Income Tax should not be included in any new system of local taxation. It fails to meet any of the criteria for a suitable tax. The commission’s report says that a Local income Tax is favoured by about a third of those who gave evidence and that they understood it. The last part of this statement cannot be true. It is avoidable and evadable, especially by the rich, it is expensive to administer, very complicated and difficult to understand, even by chartered accountants. Its impact on employment and trade is so deleterious that at least one pound is lost from the economy for every pound taken in Income Tax.  That people are familiar with it is its only merit.

The Council Tax, based on the market price of houses, has no merits which are not shared with Land Value Tax (LVT) which is best described as Annual Ground Rent (AGR): but unlike AGR, Council Tax has the disadvantage of deterring improvements to houses which would shift them to a higher tax band. It also fails to encourage the development of suitable vacant land, nor does it discourage land banking. There is wider variation in house prices within a locality than there is between land prices, which make valuations more difficult and expensive.

AGR has the big advantage of stimulating development, and employment associated with development. This will increase the production of wealth, and the rental value of land will rise but its market price will fall because speculators and land hoarders are discouraged. The current relationship between the rental value of land and its market price will no longer apply. The ability of young people to afford a house will be greatly improved. Without a fall in land prices, the price of houses will never be affordable.

Without a fall in land prices, the price of houses will never be affordable.

The experience of countries like Denmark shows that a revenue system based on the value of land can be made to work and is easily administered with frequent revaluations.

A form of AGR; a Land Tax, has been used previously in Scotland. It was the main source of revenue prior to the 1707 Union of Parliaments and continued for several years afterwards but was gradually abolished by the landowners in the Westminster Parliament, who changed the tax laws to pass the burden of paying taxes onto working people so that the barons and lairds could enjoy the unearned rental value of the land. We are often told that we live by the ‘Law of the Land’ but it would be more accurate to say we live by the ‘Law of the Land Owners’.

AGR could simply replace the Council Tax at current levels of local government revenue collection, but its simple application would more equitably distribute the burden of costs among those who are required to pay; but if it is decided that the amount of revenue collected locally should supply more than the 12% currently obtained from Council Tax to improve local democracy and accountability, the revenue from ground rents, what we call AGR, could be increased and the National Income Tax reduced.

I am often asked why I advocate the collection of the AGR to fund the necessary functions of government. My wife and I own a farm in Fife, of about 650 acres, its market price will fall markedly if AGR is introduced. I estimate its current market price to be about £4m, which is above £3m more than we paid 23 years ago. The £4m price tag is no advantage to us at all because we do not want to sell it. The farm’s earning capacity is not increased by this high price.

In fact it is a disadvantage to us in our desire for the next generations of our family to continue farming. If our son has to buy out his brothers and sister he will have to sell the farm to do so. If the price of land was close to what its productive capacity would justify, there would be no problem.

We have not earned the £3m by which the market price has risen, it is the result of the perverse tax system, which favours the ownership of landed property and discourages employment and enterprise.

I hope that when the NFUS discusses the Land Reform Bill that it takes into account the problem of the high price of farmland and the reasons why it is so high. I am not concerned that the market price of our farm will fall because we will gain from the reduction in the harmful taxes, which inhibit us now.

We would like to have the opportunity to be reasonably rich from farming our land, not to be unreasonably rich by selling our land for an unreasonably high price.

I know I am not the only farmer in Scotland who favours the collection of AGR by the government. I am probably the only one who is prepared to stand in public and say so.

The SNFU also uses the principle of AGR when it charges membership fees per unit area according to the quality (which NFUS calls ‘capability’) of the land farmed.

We agree completely with the concluding statement of Commission that: “This is an opportunity that must not be missed”.


The following FAQ has been prepared by the Scottish Land Revenue Group (SLRG) as a general guide:

FREQUENTLY ASKED QUESTIONS (FAQ)

What is AGR?

Answer: “Annual Ground Rent” (AGR) is an alternative means of raising revenue to replace current local or central government taxation that is required to pay for all public goods and services.

Unlike any other economic resource land is both universal and permanent (save only for cataclysmic acts of nature, produced most typically by sea, geological events, such as erosion or the changing course of rivers).

With these very rare exceptions every parcel or tract of land, large or small, in city or country – every site whether agricultural, timber, mineral or urban – has some potential annual rental value.

This potential rental value applies to the land or site itself alone, and does not apply to any building or development on the site (the development of a site, such as a building or new extension, is the product of labour or enterprise, which is quite separate from the underlying land or site that is given by nature).

This rental value of the land or site is created not by any individual owner but by aggregate demand (i.e., the fundamental need we all have to occupy land and use natural resources).

It is a public good provided both by nature and any further advantages created by the site’s location as a result of the product of the community and the labour and investment of many (e.g., and only as an example, in a city with all the facilities, services and infrastructure this implies).

At present the landowner makes little or no contribution to this public investment and AGR is an annual rental or levy designed to share this gain with the taxpayer.

Under “Annual Ground Rent” (AGR) this public rental value would be collected from the site owner or landowner, while exempting from taxation the value of all buildings and other produced assets owned or developed by the labour or investment of individuals or organisations.

Why are there different names for AGR?

Answer: Over the long history of this idea, which is long associated with the American thinker Henry George (1839-97), it has been known under a number of names, abbreviations and titles; Land Value Tax (LVT) or Land Value Rating (LVR) being only the most common.

Annual Ground Rent (AGR) accurately and simply describes what it is; a rent payable to the wider community for the resources, investment, services, infrastructure, activities and presence of the population that give value to the basic, undeveloped site; the ground, the specific area of land its core undeveloped value.

AGR is not a confiscation of private property which remains in the same hands, nor is it really a tax: because it is universal – every piece of land or site will pay a core rent, that will be established at a level according to its variable rental without valuing whatever stands on the site and is excluded from the rental charge, save only accounting for the highest undeveloped ‘planning permission’ the site possesses.

Taxes, on the other hand are arbitrarily set according to the changing political preferences of passing Governments, and operate as public confiscations of revenues that are created by labour, by investment or trade.

Some taxes are expensive to raise, difficult to administer and easy to avoid or even evade; how does AGR solve these problems?

Answer: AGR is cheaply and easily administered because mapping is computerised and individual sites do not have to be visited to assess values. Denmark has such a system and it requires fewer valuers (assessors) than a system bases on house prices.

AGR is impossible to avoid or evade because land cannot be hidden or moved and values can be made available for public scrutiny. Failure to pay the AGR leaves the owner open to the risk of the property being taken over by someone else that is willing to pay.

Why should I support AGR?

Answer: The move to Annual Ground Rent will, for most households, be of immediate financial benefit. Most property owners own only the parcel of land beneath their residence. A large segment of the population owns no land at all. In time, the cost of acquiring land for residential homes and businesses will begin to come down, creating a far more affordable economic environment than exists today.

Would Scotland be better off with AGR?

Answer: People who actually produce goods or provide needed services to others (whether through their labour or enterprise) are today overburdened with taxation. A shift to Annual Ground Rent (AGR) as a primary source of public revenue would relieve the productive sector of Scotland’s economy of its heavy tax burden. Scotland’s producers would be in a far better position to compete in the global economy, providing new employment opportunities for the people of Scotland. In due course AGR could be extended to replace other taxes on earnings and enterprise.

Why do you think taxes harm the economy?

Answer: The impact of taxes on the economy is best explained this way. The higher the taxes imposed on goods and services the less will be the supply of goods and services generated. When taxes are too burdensome on businesses, they pick up and move to where taxes are much lower. And, when businesses leave, people leave as well. Those left behind are often principally the elderly and the unskilled, who must now be supported by a social welfare system struggling to find the needed revenue. Annual Ground Rent solves this problem because neither production nor profits are subject to taxation. One is merely required to contribute to the community the annual rental value of any land owned.

Why do you think AGR encourages the economy?

Answer: When owners of land/sites are required to compensate the community for the privilege granted to them (i.e., to have exclusive use and ownership of part of the community land), they will develop the land to its highest, (most productive) use in order to generate sufficient revenue to cover the Annual Ground Rent charge, other living expenses, and whatever other desires they have.

Imagine the synergy created when every owner of property is rewarded for what they actually produce rather than being allowed to sit on vacant land for decades or generations while the remainder of the population must compete with one another for living space in a market that rewards  those who continue to hoard land to make excessive profit, at nil cost, and without contributing to the community activity on which the value of the site and the profits the landowners make, depend.

I run a business. Why will AGR be good for me?

Answer: Once AGR is fully implemented across the spectrum, if you own property (land, buildings and other fixed assets), the value of buildings value and other business equipment will no longer be subject to taxation. Your financial obligation to the community ends once you have satisfied your Annual Ground Rent payment.

I am an employee. Why will AGR be good for me?

Answer: Wages and benefits offered to people who work for others is based on supply and demand. What Annual Ground Rent (AGR) gradually achieves is a situation where there is always a greater demand for people than the number of people in the workforce. In short, AGR is key to the elusive full employment society.

Will farming benefit from AGR?

Answer: Yes.  The benefit will depend on the extent, by which the existing harmful taxes, such as the Income Taxes and VAT are reduced, to be replaced by AGR. The removal of income taxes will greatly reduce the costs of employment and the time and money spent on bookkeeping. The reduction in the market price of farmland will benefit those young people wanting to make a start in farming but cannot afford the current price of land which is almost five times that which can be justified by current input costs, yields and product prices.

Only those who want to sell the land they own benefit from its high price but for the majority, who want to earn a living from farming, high land prices are no advantage. For young newcomers to farming, they are a serious barrier. The tax reductions we recommend will reduce the costs of production for all farmers, including those who rent the land they farm.

I cannot afford to buy a home. Why will AGR be good for me?

Answer: Affordability of a residential property is based on the relationship between several important factors: (a) household income; (b) household savings; (c) the price of the property (land cost plus building cost); and (d) the terms of available mortgage financing; (e) the land cost paid by the developer. The adoption of the Annual Ground Rent (AGR) system will, over time bring down the land cost component of a residential property.

Some owners of land who have no intention of developing their site will put the land on the market in competition with others. Thus, developers will be able to acquire land at lower costs, enabling them to construct new and more affordable housing units.

I rent my home. Why will AGR be good for me?

Answer:  As developers begin to acquire land at lower prices housing prices will fall, but it may take some time. As the supply of rental housing increases, the owners of these units will compete with one anther for tenants, and this will tend to keep apartment rents affordable.

In the first instance AGR is payable by the landowner, not the tenant. Of course the landowner (landlord) will seek to pass on the cost to the tenant in a higher rent, but that adjustment will depend on local house rental market conditions.

I own my home. Why will AGR be good for me?

Answer: Even if the Annual Ground Rent (AGR) System is implemented over a period of years, you are likely to experience a lower annual bill, with the owners of upmarket properties in high-demand areas paying more. However, this depends on how much land you own and whether your property is located in a high-demand area or not. High-value land will pay a premium.

Most owners of residential property on small land parcels or in less expensive areas (the majority of the population) will experience a reduction on their annual public service payments under Annual Ground Rent.

I cannot find employment. How will AGR help?

Answer: Annual Ground Rent (AGR) does not produce overnight change, but it favours economic activity, labour, enterprise and investment over passive land ownership. As AGR progressively reduces the overall tax burden businesses will expand and begin to hire more people as more and more public revenue comes from AGR, and less and less from other sources.

Can AGR prevent the next recession?

Answer: The causes of economic downturns – of recessions or even depressions are complex. What a close study of economic history reveals, however, is that at the heart of every such downturn is a crash of the property markets. The depth and duration of the crash is directly related to the rise in land prices. In turn, these “land price bubbles” are driven by intense speculation, worsened by imprudent bank lending practices. The next recession is, sadly, already in the making.

The adoption of AGR may mitigate the harshness of the next recession but will not prevent it from happening. Nevertheless, only the full adoption of the AGR system will ensure that the principal cause of our inevitably recurring ‘boom-bust’ economy finally disappears.

My community wants to buy land. How will AGR help?

Answer: Over time, Annual Ground Rent will bring down the price of land, making it easier for communities to acquire land for parks, schools, public transit rights of way, and other public amenities.

Here is what happens in the current system. Every parcel or tract of land has some potential rental value. Even when the owner does not lease out land to others to collect this value, it is there. Market forces capitalise this real or imputed rental value into a potential selling price. AGR brings this value into the community treasury, leaving nothing to be capitalised. The result is that land prices will fall over time.

I live in the city. Why will AGR be good for me?

Answer: Every city has a central business district and residential neighbourhoods where the demand for land is great. At the moment, most of this value, which is generated by the activities of the whole community, public resources and many individuals, is retained by the owners of land. AGR changes this dynamic in favour of the productive segments of an urban economy. You will gradually have more employment choices, more housing choices, higher wages and better benefits. Why? Because investment in job-creation and economic activity will bring a higher return on capital invested and the cost of leasing or acquiring land will begin to fall.

Where did AGR come from?

Answer: For most of history, governments collected “ground rents” from those who were granted use of land. As land ownership became privatised and the political power of landed interests grew, less and less public revenue came from ground rents.

Yet, there have always been efforts by civic-minded leaders to return the source of public revenue to its original, and fairest, source.

Throughout history, and noticeably in 1707 and again at the beginning of the 20th century, Scotland has been in the forefront of these efforts, although they have always been deflected or defeated by well-entrenched vested interests that established a system that excluded land from taxation.

Passing the responsibility for raising public revenues almost exclusively to the active economy based on taxation of labour, enterprise and investment, rather than on the land based interests.

In recent years business and finance has been very effective at reducing their tax payments through aggressive tax avoidance, globalisation and the wide use of foreign, secretive tax havens, unlike labour and payers of PAYE and indirect taxes.

In the modern era, the arguments are found in the writings of many political economists and moral philosophers, including Adam Smith. During the late 19th century, Liberals in Britain (influenced by the American writer Henry George) began a serious campaign to re-introduce the full collection of ground rents. They almost succeeded early in the 20th century with what was called “The Peoples’ Budget” (1909) under Lloyd George’s leadership. Labour later added Annual Ground Rent to its platform.

The House of Lords and landed interests defeated the ambition of the Peoples’ Budget and with the intervention of two World Wars and other national crises, the Labour Party gradually moved away from the ambition.

The agitation to adopt Annual Ground Rent has been a long and arduous campaign to finally bring about a full implementation of a just system of property rights and public revenue.

The opportunity today in Scotland is that with Holyrood and the return of a Scottish Parliament, its time has come.

Why is it claimed AGR is not a tax?

Answer: The rental value of land is not produced by individuals, it is a function of nature and of complex interdependent communities and publicly resourced activities; it is, by definition, public revenue (much of which is now being privately retained).

What are ‘deadweight losses’?

Answer: This term, used by economists, refers to the negative impact on the production of goods and delivery of services causes by the imposition of taxation.

 

Comments (124)

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  1. Scott Egner says:

    Thanks or this article. We had a frustrating few years trying to acquire a small amount of land for a smallholding and were time and time again outdone by the property speculators. We finally had a lucky break but still know lots of friends who just do not have the means to fulfil their dreams and farm a parcel of land.

    I have a sizeable mortgage now but I agree, we have to start deflating this land and housing bubble for future generations. We have a nation addicted to a ponzi economy.
    We call ourselves a capitalist country but the UK is more akin to a tax payer backed casino.

    From a political point of view are there any estimates of likely total revenue when compared to council tax?

    1. C Rober says:

      Part of this problem is that the Banks debts were socialized , and they (unlike those they lend to) did not offload assets , specifically property at a loss to the highest bidder or indeed land.

      1. Ron Greer says:

        C.Rober: indeed and now it’s time to socialise the rents.

  2. ian says:

    We are the inheritors of a tax system devised by land owners to entrench their privileges. They did not care that their tax inventions lost £1 for every £1 raised — so long as their pocketing of public value remained secure. That is fine if that is what society wants. However, nowadays do we not want other groups to share in Scotland’s wealth? Such as renters who fund landlords’ mortgages and subsequent capital gains? Or the males in Drumchapel who die 12 years earlier, on average, than East Dunbartonshire men because of harm directly attributable to the taxes devised by a landlords’ Parliament at Westminster? Yes, AGR will sort this out. Let’s get behind it.

  3. John Bryden says:

    1. What you call AGR is otherwise known as Land Value Tax, advocated by Henry George in the 19th C, and also by many others including myself in the John McEwen lecture 1995-6. It is as you say a fair, just, and collectable tax that is hard to avoid (unless the legal drafters make it thus!).
    2. A ‘local’ income tax can also be fair, but the idea is grossly misrepresented and misunderstood in the UK, and especially in Scotland, as an ‘additional’ tax. In Scandinavia, income tax is in most cases collected by the Municipalities (not any longer in Denmark since the reforms of local government), who keep a share of that income tax to cover local government duties. The rest goes to the Counties and the Central government, in agreed shares. This also happens in other countries. It does not take additional work/ expense in collection, gathering and checking for avoidance. This kind of local income tax is good, and the system should be adopted by Scotland!

    1. ian says:

      John, any income tax is a tax on jobs, production, spending — and much more. In other words, repressed economic activity to the tune of £1 lost for every £1 raised. This we can do without in Scotland.

      1. John Bryden says:

        No, Ian, income tax like any other tax transfers income from people to government to pay for education, health, and other public services. If it is, as it should be, progressive then rich people pay a higher percentage of income than poorer people. Government spending is either consumption or investment too, and that often creates more jobs than private consumption or investment.

        1. Ian Kirkwood says:

          AGR will fund public services (out of publicly created value) but without losing £1 for every £1 raised. Why would you advocate continuing with systems that costs us so much? Inefficient revenue systems are the reason why public services have become unaffordable. Let’s end our addiction to free capital gains for land owners. Halt the tax damage. Pay £1 for £1 of public services — instead of £2. Please listen to Adam Smith. AGR is free of economic harm.

          1. Frank says:

            I would like to see the maths for losing £1 for every pound raised in income tax.

    2. Roger Sandilands says:

      There is a huge difference between the ‘fairness’ of the ‘Annual Ground Rent’ fiscal system and the ‘fairness’ of income tax, whether locally or centrally administered. The first is based on the benefit prinicple and as such has a definite ethical principle at its base. Income tax (on earned as well as uneraned incomes) is based on ability to pay. So if I work twice as hard and long as my neighbour or am more efficient because of innate talent or skill acquired through hard study and experience, I am liable to be taxed more, and progressively so. And then think of the disincentive effects as well as the lack of any solid ethical basis.

      And if you shift the collection of income tax from central to local government (instead of having central government apply the current rates equalisation system across LAs, and you let the LAs keep all they themselves raise locally, how will that be fair? Let Chelsea keep all its AGR, and not have any of it redistributed to Huddersfield or Motherwell? No thanks.

    3. Ron Greer says:

      We chose the term AGR advisedly because it is not in effect a tax. The Term LVT has been a ball, chain and deadweight round this concept for 100 years. There is no tax that ever increased the production of labour, services or goods and there is no fair level of such a tax. AGR is 100% produced by societal demand and its 100% return is 100% fair and unavoidable. It does not punish labour or improvements on bricks and mortar property.

  4. pipe dreamer says:

    Of course, The absolutely glaring difficulty of this type of system is that it may push higher taxation pressure on the wrong people…..and have consequences regarding things like developments and, worst still, tenants.

    It will also have some rather unfortunate side effects. What exactly is Value related to? Actual Use or potential use?

    A planning re-zoning could cripple people if it is based on the latter, and if it is based on use, then the actual use could be very different from ‘value’ use.

    I am fairly sure that these are the practical stumbling blocks that have stopped this being implemented in the past and why the current system is in place.

    1. ian says:

      Developments: Disused and banked land that carries an annual charge will tend to come into use, freeing up large areas for development at competitive prices. This will mean more and cheaper homes to buy or rent.

      Tenants: Rather than funding landlords’ mortgages and ongoing capital gains, renters will see that part of their rent collected by the state for funding public services. In this way they will for the first time benefit as equals with their landlords.

      Best use: A piece of disused land suitable for housing will attract an AGR charge matching that purpose. Society should expect the best use to be made of all land. There will be no compulsion to retain ownership of land.

  5. 1314 says:

    What a great article (and such a relief from all the divisive claptrap about second votes).

    Here’s another thought – houses cost much the same to build from year to year so the increase in cost is absorbed in land value. To put it another way – New build house value = Land cost + building cost. Since the cost of building is roughly constant increased valuation means increased land value, fine if you own land, rubbish if you just want a roof over your head.

    Also VAT is 0% on new build but 20% on maintenance and improvement/extension. If this was reversed, and going by the above equation, land value would have to reduce to maintain the same new build evaluation. We still need new houses and, since there would be no increase in the overall cost, there would be no reduction in employment there – but more employment in the much more labour intensive home repair and improvement market.

    1. Frank says:

      House prices depends on the availability of finance, the cost (%r) of that finance and the planning system allocating an adequate supply of land for housing. When the planning system restricts supply in the face of rising demand then house prices rise and when interest rates fall house prices keep on rising. Once you have allowed house prices to reach restricted market levels you create a vested interest in maintaining high house prices – for to remedy the situation and reduce house prices leaves perhaps millions with negative equity and, other potential economic problems aside, that is political dynamite.

      AGR will do precious little to solve that problem, on the contrary in towns and cities it is likely to lead to high rise developments as that will be the most profitable use to which residential land can be put. This has already happened with traditional houses with large gardens being demolished and flats being built in their place. AGR is no more than State feudalism and feudalism is the enemy of a free people. I suspect Agenda 21 is at work here. Think about it.

  6. jackie says:

    AGR may well be just the thing for unbuilt land, but there are quite a few folk who have become owners of “high value properties” due to gentrification which has taken place around them but still have the same incomes they had before the property market went mad. You cannot prise a few slates off the roof to pay AGR or anything else. The fair to all solution for residential taxation is local income tax.

    1. ian says:

      But if society has increased the level of amenities and services in ‘gentrified’ neighbourhoods (which is what increases the demand and the values), then those making use of those services and amenities should be asked to pay for them. Do you prefer the alternative? That the inhabitants of ‘ungentrified’ areas must pay for the services of the gentrified areas instead. As happens now. It’s the reason why public services cannot be afforded.

      1. jackie says:

        No new services or amenities have resulted Ian, just more and more development shoehorned in, posh shops ousting the useful ones, Chelsea tractors everywhere and a thin grey haze dimming the sky on sunny days ….

        1. ian says:

          The other variable in site values is property speculation. How to end this obsessive race and bring communities back to reality? AGR. By collecting the full ground rent the speculation ends and values return to normal, making housing affordable to own or rent. Picture where AGR will take your community. Denmark has AGR and as a result enjoys homes a lot bigger than our new ‘rabbit hutches’. It is no co-incidence Denmark was voted the world’s happiest country.

    2. Ron Greer says:

      Jackie,
      This is just a variant on the old ‘puir wee Tory widow living a big hoose, but nae cashflow)’ story. The AGR can be deferred until death and the amount due taken from the estate. The person in the big hoose can sell it, and demand will be high if the land it sits on has a high AGR rating, and keep the capital value completely free of income tax. Another option is to rent out a room or rooms, so that the tenant pays a proportionate share of the AGR and the money earned by the landlord via the specific provision of the room and the facilities offered by it retained by the landlord, again totally free of income tax

      1. Jackie says:

        Variation being NHS employee pushed out of very ordinary one bed flat. And most certainly not a Tory thank you. Local income income tax would take from people what they can afford.

        1. John S Warren says:

          No it will not. If, for example AGR was set simply to take the same revenue as the current Council Tax; unless you have the most expensive one-bedroom flat in Scotland on the most valuable site, for most one-bedroom flats, in most tax bands it is likely that the AGR would actually be below the current Council Tax (assuming everything is ‘mutatits mutandis’). Those who pay more than now would bemost typically be in larger houses in high-value neighbourhoods, because currently they pay disproportionately less; this is just the basic facts.

          1. Frank says:

            John S Warren. In a feudal society the feudal lord has a substantial degree of control over the lives of those who we will call his subjects. Under the present system of council tax we have rebates for those unable to pay the full amount. Under AGR there will be no rebates since that would defeat the very purpose of AGR. According to your argument the land value will be based on the value of the property on the site, but there will be no rebate for those unable to pay the AGR and so the individual will lose control of his property, he may be forced to take in lodgers or sell up and move to a property where he can afford the AGR, or, as was suggested, he can defer payment till after death. In the latter case, if he lives long enough the feudal lord (the state) may take most or all of the property to pay his back taxes. That is what I mean by state feudalism. But it has other adverse implications. When Henry George proposed AGR there was no planning restrictions on development, there was a free market. Not so today and unless the planning system allocates additional greenfield land for housing then, in the face of rising demand, land within existing towns and cities and despite the owners being “encouraged” to develop, will increase in value and this will lead to increasingly dense housing developments. Since the purpose of AGR is to ensure the “efficient” use of land it is highly unlikely that additional greenfield sites would be allocated. Again the feudal state will have a large degree of control over where and how we live our lives. As for increasingly dense housing developments, all this does is produce health/social problems and that is a needless cost to society. Of course when that happens the paternalistic state could always increase the AGR and employ more social workers, community nurses, policemen etc. etc. to deal with the problem. (I say that with a large degree of cynicism) Scotland has a lot of problems that need to be addressed but I suspect AGR would create more problems that it would solve, AGR is a tax on our very existence.

          2. John S Warren says:

            Apart from repetitive use of the word “feudalism”, no doubt intended to strike fear into the heart of every “free” citizen, there is nothing of substance in your argument. I haven’t seen quite such a crude use of emotivism in an argument (since AJ Ayer’s ‘Language Truth and Logic’), as your reference to the landowner “losing control of his property”. He won’t lose control; but he (or she) will be prevented from ripping-off the community, and taking virtuall all the public good created as a private dividend.

            AGR requires only that the value created by the community in every location (large, small or negligible) is fairly reflected in a simple charge to the landowner, rather than being siphoned off by the landowner (for nothing), completely free of tax. In fact AGR properly implemented would lead to the reduction and indeed elimination of taxes on investment, labour and enterprise. It is liberating. It creates real wealth and spreads it where it is earned. It is fair, effective and wealth producing. You are defending the indefensible, but dressing it up (somewhat theatrically) as a danger to liberty (even Milton Freidman was driven to concede the case for AGR).

        2. Ron Greer says:

          With AGR, you’d be paying no tax on your wages, no Council Tax and no tax on what you sold your flat for. Can you name a fair level of income tax, what makes it fair, one that cannot be avoided and one that would encourage labour and enterprise?

          1. Frank says:

            Nice theory but you overlook every government’s insatiable demand for more and more money to pay for all the “services” they want to provide for us. In general I suspect that it would end up as just an additional tax.

          2. John S Warren says:

            This latest ‘dialogue’ began with an unsupported, grand, sweeping assertion that “AGR is no more than State feudalism and feudalism is the enemy of a free people. I suspect Agenda 21 is at work here. Think about it”. Well we had thought about it; but there is not much of actual substance behind the big rhetorical flourishes you have presented and with which it is possible actually to engage in debate: and speaking only for myself, I have no interest in Agenda 21.

            I do notice however that in response to Mr Greer’s reply, your rebuttal of his argument has moved from generalised sweeping assertions about State Feudalism (gratuitously and pejoratively offered as if they were obvious facts), to “In general I suspect that it [AGR] would end up as just an additional tax”. No doubt you do suspect this, but on what grounds should we (or anyone else for that matter) give your vaguely articulated suspicions any particular credence?

  7. john young says:

    We need to reduce the amount of money levied on people from transport/energy/rent or mortgageput money back into the publics pockets this will generate more spending hopefully more jobs,why is it that the biggest majority of the populace have to struggle through life with hardly a break.

    1. ian says:

      Yes. AGR works automatically on multiple fronts to reduce inequality. When embraced, AGR imposes a carefully assessed charge for what you use (resources, amenities and services) and allows you to keep the fruits of labour and enterprise (by ending Income Tax etc).

  8. Phil Robertson says:

    I think you have to add two more features of a new tax – it should improve on what it replaces and it has to be electorally acceptable.

    On first impressions I can see why the concept comes over as attractive but, on closer examination, it becomes less clear that it is better than the council tax especially if that were subject to regular revaluations.

    I appreciate that there is no single model but if we envisage something similar to Andy Wightman’s ” A Land Value Tax For Scotland”,

    – “The current relationship between the rental value of land and its market price will no longer apply” but that does not mean that the two remain unrelated. So improving a property may well result in a rental increase.

    – on Wightman’s figures the share of the tax on residences (which is where voters live!) rises from about 0ne-half to lose to two-thirds.

    – it shares the difficulty of the council tax in the link between place and the people living there which inevitably leads to exemptions and caps e.g. for single person occupancy which complicates the administration. you mention “wider variation in house prices within a locality than there is between land prices, which make valuations more difficult and expensive.”. I’m afraid it the variation that complicates administration not its width.

    – trying to pretend that is “not a tax” and not liable to government manipulation is wishful thinking.

    1. ian says:

      One way in which it improves on the Council Tax is that it is not subject to 1:1 deadweight losses. By cancelling Income Tax in Scotland, Holyrood would lose £12 billion …and cancel £12 billion of lost economic activity. This devastating proportion of losses would have to be suffered on any Income Tax raised to fund local government. But by collecting the value of the land, the area of land is not reduced by one square millimetre.

      Another way in which it would improve on Council Tax is that, by not taxing buildings, the housing supply would be increased and its value deflated to realistic levels (our children could acquire one or afford the rent).

      1. Phil Robertson says:

        “One way in which it improves on the Council Tax is that it is not subject to 1:1 deadweight losses.”

        Not sure that I understand the logic of this. All taxes, including land tax, have a deadweight influence by taking money of of the consumer economy. And there is no evidence that council tax has been a brake of house price increases.

        ” the housing supply would be increased and its value deflated to realistic levels (our children could acquire one or afford the rent).”

        Again, no evidence of this. Denmark currently has rising house prices and has required state subsidies to keep the cost of rented properties under control.

  9. pipe dreamer says:

    Has anyone actually thought this through?

    So when a tenant farmer is paying rates for agricultural land that suddenly gets the green light for housing…..He gets a huge increase in rates?..but is tied into a lease……and gets to feel the benefit of the fact that the money isn’t going to his landlord?

    A lot of banked land is in use by tenant farmers and they pay the rates

    If that farmer owns the land, he would now have to either cought up or sell up.

    As i asked before, Is this ‘value’ for taxation going to be ‘use’ based or ‘potential selling value’ based?

    for something to be ‘better’ than the system we have, you , who are proposing it need to say what the heck its based on. land by area? land by use?, Land by value? land by potential sales price?

    you do know that the current rates system directly uses all of these already? …and balances them out? this will whack people it isn’t supposed to and I am certain that’s why it has been looked at for years and never been implemented.

    As much as people like to think the present system is grossly unfair, and that is something I agree with to some extent, it is better to change the baseline on the current system than change the whole philosophy of service provision.

    If it is ability to pay then make it income tax. If its value of service make it that. Arbitarily setting it on value of land is nonsensical.

    1. ian says:

      Society controls the use to which a piece of land is put through its planning authority. Thus, under AGR, the owner of a marginal hill with attracting zero AGR will incur an adjusted on-going charge subsequent to a successful application for say, a wind farm. But that does not mean all such hills will be charged the wind farm rate. This is the way to collect publicly-created value fairly — gathering in the value we create in society so it can be used for more amenities and services.

      The tenant farmer is safe, because society – and even its planners – know we still need farms.

      1. pipe dreamer says:

        “The tenant farmer is safe, because society – and even its planners – know we still need farms.”

        So now we will have start of exceptions to the rule?……. Now if all the housing companies who bank land set up a nice combined agricultural farmer company to rent the land they are banking for grazing just like they do now……They just got round paying it didnt they?

        No joined up thinking at all on this

        1. ian says:

          Yes, anyone farming will pay the AGR of a farm. If planning permission is granted for another use the assessment changes. I have no problem with that.

          1. Crubag says:

            It is possible to apply for planning permission on land you don’t own.

          2. ian says:

            Land banking has in fact been thought out: Society adds value to land the moment planning permission is granted. Under AGR that value is assessed and collected. Land speculation is therefor cancelled. And land banking — outright. Those looking to speculate in search of unearned income must look elsewhere. A land bank designed to pay out vast sums when the time is right could never pay out.

            The increased site value has cost the owner nothing. It is provided free by society in the form of its planning consent (which incidentally means we need to learn to see our planning authorities in a very positive light). This stream of value is the logical and damage-free source from which to collect revenue for the purpose of running our public services (according to Adam Smith, Scotland’s great economist and thinker). In return the owner is free to live, work and do business, retaining the profits of his or her enterprise on that site under the terms of the planning consent.

        2. Ron Greer says:

          Pipedreamer: well if they do they will still pay the AGR rate for agricultural land and if they apply for planning permission for house building then they will have to pay the new, higher AGR rate for that. There is no avoidance as land can’t be hidden or transferred to an offshore account.

    2. John S Warren says:

      “Has anyone thought this through?” Actually there has been quite a lot of thought, over a very long time. The complete lack of thought is rather to be found in the current system, which is a dysfunctional mess that nobody would use (nobody responsible) if it had not been foisted on the public by a Parliament long ago, maintained by fillibuster, representing very narrow vested interests; and never changed by politicians who were too small for the task.

      Only in 1909 did Parliament briefly think of correcting the blunder, and it was the House of Lords that prevented it; bizarrely, this cost the House of Lords most of its power, but the privilege for land to accrue excessive profits free of charge remained in place to this day. We now tax virtually everything, whether it makes any sense or not. Few economists who have actually addressed the substance of the issue challenge the credibility of AGR.

      Meanwhile everything that produces real economic activity has been taxed (at one point even windows), burdening and holding back labour and enterprise (deadweight loss); and there is still no charge for sitting on land, and accumulating large profits for doing absolutely nothing completely free of charge.

      No ordinary person, now in this country, whatever their skill, nor however hard they work, can can expect to work or invest and by enterprise or effort match this free lunch in land. It is absurd. There are no arguments against AGR that are nearly as bad as the incompetent, badly conceived hopeless nature of the current tax system you are effectively defending.

  10. pipe dreamer says:

    you do know that planning can be got by anyone simultaniously for different purposes?

    I could have a plot of land with simultanious planning permissions for a house or a commercial garage, but is curently being used to paddock a horse. It’s right next to another plot exactly the same size without any planning applied for but is being used as a paddock for another horse……whats their’s values? Why is one derelict and not being developed while another isnt? What happens when the planning permission runs out?

    IF you say that the rates the respective horse owners should pay are the same then you have just underminded the concept of Land value tax and annual ground rent based on value. If you base it on land area, How do you work amenity areas that are in public ownership ? because value isnt based on area, but facilities.

    1. ian says:

      There will be a regular assessment (bi-annual in Denmark) of the rental value of each Scottish site (minus improvements such as buildings) which would include an integral appeals process.

    2. John Digney says:

      AGR would be based on optimum permitted use, taking into account prevailing planning constraints/consents. The plot with planning permission would be subject to higher AGR than the one without. The owner would be paying that, so simply keeping a horse on it would be financially foolish. The incentive would be to use the plot to its optimum potential within planning permission or make a loss. If he is renting the plot to someone for their horse, no sane horse-owner is going to pay the higher rent to him for the same grass as on the other plot. AGR is the solution to the problem of land hoarding.

      1. Crubag says:

        So it would be more desireable to have houses than parks or allotments in urban areas?

        And high-density rather than low density housing?

        1. John Digney says:

          Judgment on land-use is another matter, and is something the electorate ultimately has to determine via its planning authorities. A major difference from the current situation is that under AGR any uplift in value goes back to the public purse rather than into private pockets, so the temptation to manipulate the planning system for private gain is much reduced.

          1. Crubag says:

            So the AGR for amenity land would be close to zero? That would also account for a lot of marginal hill ground, unless taxed on potential sheep/deer use.

            That pushes more of the burden onto the farmers in agriculturally favourable areas.

        2. Frank says:

          Crubag – that is the clear implication.

  11. Crubag says:

    It’s interesting that a farmer has written this. AGR would mean that farming and forestry would be paying taxes – at the moment they are exempt from business rates.

    But it would be impractical to replace other taxes with AGR. Based only on Scottish Government expenditure, each acre of Scotland – 70% of which is in farming use – would need to pay £15,584 a year. So the 650 acre farm would be paying £10.1 million in taxes.

    1. Duncan Pickard says:

      About 90% of Scotland is rural land but its value is about 10% of the total. Urban land is 10% of the area with 90% of the value and will be liable for 90% of the AGR. No land will have to pay more than can be afforded. Don’t think we aren’t taxed at present. I will gladly swap an AGR liability for our existing taxes plus their costs of administration.

    2. Duncan Pickard says:

      I have just checked my calculations and they are correct. May I suggest Crubag does a recalculation too?

      1. Crubag says:

        My figures are out by a factor of 10!

        Apologies, I mishandled the translation from kms to hectares and acres.

        I’d now estimate that the £30 billion the Scottish Government spends, raisex through a land tax, based on Scotland having 77,934 sq km / 7,710,000 hectares / 19,460,000 acres (hello, 1960s!) / 77,934,000 sq m equates to:

        £3,891 per hectare
        £1,542 per acre
        £385 sq m

        So a 650 acre farm – £1 million p.a.
        80 sq m house (no garden) – £30,796

        So I stand by my point that ARG could not replace existing taxation. There might be value in applying business rates to agricultural and forestry enterprises, and perhaps in a reduced form to land banks, however.

        1. Ron Greer says:

          CRUBAG( Who ever you are in reality) ScotLAND comprises 30% of the current terrestrial land mass of the UK, 50% of the marine continental shelf and 70% of the coastline. We have 9% of the population. It is one of the most favourable resource/population ratios in Europe. AGR will be levied on all that land resource, apart from state-owned land or land otherwise zero-rated for other purposes. The vast majority of AGR value, as Duncan Pickard has repeatedly pointed out to you, is on urban land, but as someone, like many others who lives on less than a quarter hectare plot, even your nominal suggestion of around £4000 per hectare does not scare me, with a now tax- free income after AGR is introduced.

        2. Col the Viking says:

          There are 4,000 square metres in an acre – Therefore 20,000,000 acres becomes circa 80,000,000,000 square metres (80 billion)
          Based on a flat rate and 30 billion revenue the square metre rate would be ten pence per square metre.
          Better details at conveyancing direct.com

          In meantime a poor conversion of units.

          1. Col the Viking says:

            Whoops, typo myself!

            37.5 pence per square metre (30 billion £ / 80 billion sq meters)

    3. pipe dreamer says:

      Just in case you think I am a farmer ( and you were not referring to the auther) I am actually in construction dealing with planning issues on a day to day basis.

      Are we now saying that rates values will be based on rental of just the land?…unlike sales value and rental value of property like present? ..but I immediately saw something about hills being ‘low ‘ rated,

      Say I own a site with property on it directly opposite some housing and There are about 20 flats opposite me. its land area is more or less exactly the same area as my land in total. It has roads but no green space and neither do I for that matter.

      Am I to pay the equivalent in rates of these 20 flats because I use the same council resources?
      Am I to pay the equivalent in rates of all these properties because my property value is about 150% of the value of one single flat? but I have more land since they are stacked?
      Who pays for common land spread over multiple leases?

      What If I am not allowed to develop the land?

      Just so it is clear , there is land that people own that is not develop-able , doesn’t and never has had planning permission and they do not actually have to maintain either….because its a statuary requirement that the council do it. So how will it work for someone who owns a graveyard? How much will they have to pay? Will we be pushing for graveyards to be dug up and developed?

      See if there was a valuation amount of a property and a small miniscule surcharge for land area, I could almost understand that, except the current system does the first part already and that includes land for sites as well. It also includes part use, mixed use, construction sites, temporary accomodation, site offices. So rather than charging people involved in economic activity that the local governent has to service, we shall move to charge based on some perceived land value based on ‘land rent’ fudged to make the values ‘fair’.

      How much does someone owning a tree belt in a conservation area have to pay? Some land isn’t actually rentable, mainly because the public have access, even using the resources on it because they consider it public. Its never had planning permission but its land in a residential area.

      Everything I have read in this thread starts off as ‘land rental’ and then follows with suggestions of setting at appropriate levels…without actually acknowledging that this is based on property value or rental which is just the present system.

      Who exactly is this trying to charge ? big land owners owning lots of ‘valuable’ rural land and empty brownfield sites that no one can make economically viable? …..maybe want to ask Tesco about that

      And we will drop rates for large industrial companies by making it land based?

      As I said eartlier, there are REASONS this has never reached fruition in the past. Its because we have a relatively fair system that is finely tuned to create a relatively fair effect across all rate payers. It isn’t perfect , but this monstrosity is nothing more than an idealistic hobby horse. There is potentially room to look at Development land as a rateable catagory within the current system. There is already rateable values applied to estate properties as houses….but looking at land rates because a business may be operating not from the land, but with it is hardly fair. Someone with a big house and land running a financial advisement to investors wouldn’t be subject to rates for their business, but someone operating a grouse shooting business would? It is also interesting that farm rates also include the unarable land in their current rates so the same land is to be rated twice?

      So John S warren,

      What is the highest ‘planning permission ‘ a site possesses when it has no planning permission.

      1. John S Warren says:

        If your site did not have planning permission for 20 flats the AGR would be completely different; your AGR would depend on what planning permission the site possessed. If there is no planning permission then the AGR would be set to account for that; I assume from what you are suggesting of the context that it would be low.

  12. K.A.Mylchreest says:

    Once you build a house on a piece of land, the value of the ‘house’ is in fact the value of that piece of land (which just happens to have a house on it). That’s how the law of land ownership works. People talk about “buying a house” when legally they are buying the land upon which the house sits. So basically there is no way that the value of the house can be detached from the value of the land it’s built on in the case of a freehold, or even most leaseholds, except in the case of flats etc. where the lease is part of a greater whole.

    1. John S Warren says:

      You are conflating the legality with the charge. There is no problem distinguishing ‘property’ and ‘site’, and indeed there is a long, long history of making a charge on land separately. We have forgotten our own history.

      1. John Digney says:

        Yes, of course you can detach the value of the house from that of the land! What happens if the house burns down? You are still left with the site and in a prime location it might well be of more value than the building that was on it.
        The value of the building is created by whoever built it. The land wasn’t built by anyone and its value is simply a measure of the level of public demand for that location. The land value is therefore publicly generated and through AGR ought to be recycled into the public purse.

  13. florian albert says:

    AGR seems to be like social credit in the 1930s. A radical idea which a small number of people were evangelical about but most people never understood. (I know it was a bit different in Canada.)

    Stop a hundred people in any Scottish town centre and ask how many have even heard of it – let alone understand its details. The number will be very small.

    In dealing with frequently asked questions, Duncan Pickard writes ‘every piece of land or site will pay a core rent, that will be established according to its variable rental without valuing whatever stands on the site and is excluded from the rental charge, save only accounting for the highest undeveloped ‘planning permission’ the site possesses.’
    I simply do not follow this.

    1. John S Warren says:

      The site is charged AGR, not the property (buildings or whatever) on the site. The rental on the site will be set at an appropriate level that reflects the highest ‘planning permission’ that the undeveloped site actually possesses. AGR is therefore variable, depending on the planning permission that has been granted.

      1. florian albert says:

        ‘the rental on the site will be set at an appropriate level’

        By whom ? What criteria will be used to judge an appropriate level ?

        1. John S Warren says:

          We have all the professional resources and expertise required to assess site rentals. Technically there is nothing difficult about this at all. Nothing.

          1. florian albert says:

            ‘We have the expertise to assess ground rentals.’

            I am not convinced but let’s move on.

            How does it then pan out for people living in a tenement or in a high rise flat ?

            At present they pay council tax on the value of their property. What payment do they make under the new system ?

            (The irony in all this is that there is a real willingness to consider an alternative to the present council tax but – as I stated earlier – hardly anybody knows about or understands the alternative being proposed here.)

    2. Ron Greer says:

      They will only hear about it, if we tell them—and keep telling them.

  14. Mojo says:

    really interesting article and discussion – needs a lot more public exposure to prepare people for necessary change whatever that might look like as Council Tax clearly no longer fit for purpose- More fear mongering campaigns are inevitable… from those who currently gain most from current system, and continue to have influence on media and establishment bodies – so those promoting AGR/Land Value Tax need to have ready some clearly presented factual information/ comparative case studies which the’average’ householder already burdened by Council Tax can readily understand what it means for them

    1. John S Warren says:

      Yes, there is a big information task to be done. Part of the problem is that readers switch off without actually taking in the concept; it is, actually simple, but it looks like ‘hard work’ (and it must be wrong!), and there is a huge vested interest that likes it that way.

      Too many people have simply ‘bought into’ an extremely bad current system, that is in spite of itself, slowly collapsing in a morass of tax avoidance, tax evasion or secretive tax havens. This is a powerful method; the problem is people have learned to look at all the wrong issues, and come up with thoroughly bad solutions.

      I invite everyone to think about it. Read about it. Make up your own mind – I am confident, given a fair hearing, how this would go for the vast majority of the population – including property owners.

      1. pipe dreamer says:

        “Too many people have simply ‘bought into’ an extremely bad current system, that is in spite of itself, slowly collapsing in a morass of tax avoidance, tax evasion or secretive tax havens. This is a powerful method; the problem is people have learned to look at all the wrong issues, and come up with thoroughly bad solutions.”

        Well, I raised an eyebrow regarding how companies like Amazon and Starbucks will get cheaper rates in the long term, but rural local producing farm shops and companies will be asked to pay more…..Obviously an extremely bad system not fit for purpose made better..sheesh.

        1. John S Warren says:

          Globalisation and Transfer pricing allows Amazon and Starbucks to pay very little tax on the things we are supposed to tax. AGR is not so easy to avoid, but it it relatively cheap and efficient to raise. You cannot hide the site.

          1. pipe dreamer says:

            can you explain to me why this system is fairer when it will give Amazon and the local Asda and even a 24 hour Alldays a discount in rates , but push up the rates of the local farm shop that opens on the weekend? This is after all what you are proposing. Push up the rates of an old miners cottage with a long strip backgarden but the modern mini garden gets off scot free?

            The two bed cottage rated the same as the 5 bed detached since they are on the same size land, all because it has a 5oo yard driveway in a rural area?

            but then that isnt actually how the danish system works apparently. The danish system value is actually this

            “The land and property value is assessed as a cash payment that a sensible buyer would offer for the land and property at the time of valuation”

            It is the same as what we already have domestically

            Houses are based on Value, not land and it appears the current rate is about 1% of the value. It also appears that dwellings are where the real burden falls. If the rates were this, the average scots household would be paying 1500 pounds in rates per year for the average 150k house and an 80,000 house would be 800 pounds

            It is obvious why the danes have this system. They just do not charge businesses the mark up that we do in the UK so pummel the householder. My office rates are almost 3k. The domestic rates of the two partners homes dont add up to that and each house is as big as the office.

          2. florian albert says:

            Does Amazon not pay business rates on their huge warehouse near Dunfermline ? Will these be replaced by AGR ?

            I am as keen as anybody to see Amazon being made to pay its fair share in taxes but, at present, it is corporation tax – on a huge volume of sales – that is being dodged.
            I remain to be convinced that AGR will put this right.

    2. duncan says:

      Mojo- this is a an important message. It needs be out there and readily understandable. Partly down to slowness and partly down to leaving school without an education I find it hard to understand. I would say I am financially illiterate, as many of my friends are, though I did get something from this article and the feed. The message and the challenge here is to get this into daily talk. If that is possible, then progress will be made. Good job on this article.

  15. Bill Fraser says:

    The council tax as it stands is totally out of date and unfair to a large element of society and must be reformed.This has to be done in an all parties agreement if that is possible to attain

  16. willie says:

    An interesting and considered piece. Taxation is unfair, and yes, it is very much skewed to benefit the very wealthy and big business. I’m not sure that Scotland has the stomach for real change. We did after all vote to continue the union under a Tory dominated Westminster. Moreover when you look below the surface of the services that local authorities in the West of Scotland and elsewhere deliver with tax money you see rampant inefficiency and widespread corruption. Inefficiency and corruption are overlooked, and whilst so much of it was cultivated under the long Labour hegemony, the SG has continued to look the other way. They don’t want to know, and especially so when criminality is involved. So who really cares about what the hapless majority are compelled to pay. The hapless don’t and if they did they’d have an Efficiency and Crime Commission looking into how extensively their taxation was squandered.

    1. ian says:

      Absolutely Willie. We’ve had a Commission to look at what might replace the Council Tax. The writer strongly proposes the Commission’s option 3 (LVT, called AGR here). I believe the economists who dub AGR beneficial on multiple levels are correct. But to know for sure, we require another Commission to determine —
      1. Wealth: A Deadweight Losses Indicator. People have a right to know how much wealth they lose because of government tax policies. If it loses £1 for every £1 it raises it is not a revenue system fit for purpose.
      2. Welfare: A Life Expectancy Indicator. People have a right to know if government is helping them to extend their lives on earth; or cutting them short.
      3. Governance: A Net Income Indicator. People have the right to know how much social value they are generating by their labour (i.e. an indicator of what the total fund is from which revenue could be raised).

  17. Ron Greer says:

    Pipe Dreamer,
    Pity you don’t have the courage of putting your name to your disparate range of convictions. However let me point out, to whoever you are, that under a full collection of societally-created AGR, companies like Amazon and Starbucks will be paying the full value of the prime locations they have chosen to put their warehouses and shops on and, unlike tax on income, they will not be able to hide it or avoid it. Since it is claimed that they are paying nothing or very little at present, we will be in a win-win situation with AGR implementation. So houses are based on value are they, so next you’ll be telling us that two identical houses , one in Bearsden and the other in Blackhill will attract the same sales price or rent if put out on the rental market?

    1. pipe dreamer says:

      Amazon etc are not paying nothing at present in rates….but this will mean they pay much less since the value of their huge building will now be based on land that doesn’t include the land for car parks etc around it since it isn’t theirs.

      Land as it presently stands can be owned by one person but has a road on it that the council maintains and has adopted. They are known as Solum rights. Anyone with a relatively new house will find their property feu will likely extend to the middle of their access road, not their kerb. I know this since I have drawn up plans for it. But that doesnt extend everywhere.

      I am still confused by what this is based on. IS it rental or value since they will be massively different. How anyone will work out what it’s best use is in open to massive debate.

      I absolutely agree that the council tax needs revised , but it is already very much a land value tax incorporating buildings. Farms and farmland are already subject to rates. It is entirely feasable to extend the current system to incorporate land in this way. Alternatively you can throw the whole lot away and start from scratch to acheive the same thing. But I will be well employed putting temporary planning applications for land to be used as grazing. Do you NOT see the massive loopholes in this?

      If land is rated with extensions of the existing catagories, The current system can be improved drastically…as I suggested by extending bands and it doesnt stand as open to abuse by relating it to planning use. But how ability to pay is incorporated is very difficult since this is where people who are very well off qualify for discounts and how large properties avoid large and properly proportional rates. Effectively we need to slide the scale out from the top H band to about Z! ….to increase the cost for mini mansions and look at wealth in total and not earnings for discounts.

      Land is misnomer, It is actually a value tax.

      The entire shooting industry is not feasable over large areas of land..unless you are for shooting craws. nor is it controllable….If someone can walk into your land and do some business and you have no way of stopping it, how can you be expected to pay for their privalige? this isnt shooting but walking tours and all sorts of other activities….ramblers for example or stray sheep?

      Sense will mean that when it comes to values, valuers will mean this will desolve and we will be left with a system with bigger flaws than we already have, with even more loopholes and disputes.

      1. John S Warren says:

        It is exactly what it says it is; a ground rent; and no, land plus buildings is not land. Amazon or whomsoever will be charged what they use. Currently land owners pay nothing, and major corporations pay virtually nothing; by being charged by government for profits that are transfer-priced or by other tax-avoidance methods simply and legally moved offshore. Land cannot move offshore. The taxpayer is currently being ripped-off, ‘big-time’.

        AGR really does work. What you are defending categorically doesn’t.

        1. florian albert says:

          ‘It is what it says it is; a ground rent’

          If you have two adjacent sites, each the size of two football pitches. One contains two football pitches, the other contains an Amazon warehouse (or a Tesco superstore).
          Do they play the same AGR ?

          1. florian albert says:

            Do they pay (not play) the same AGR ?

          2. John S Warren says:

            Assuming in every relevant way, ‘mutatis mutandis’ they are exactly the same, and the sites have the same underlying site vaulation, it would then depend on what planning permission was granted for the sites. It is very unlikely they would be paying the same; if there was permission for a “higher” (more productive) use, then the owner of the football pitch would be unlikely to pay the AGR for the more productive use. If, however, the pitch was owned by a local authority or similar as an important service to the community, I would not expect the higher planning permission to have been granted in the first place; but that is matter of local democracy.

          3. John S Warren says:

            If the owner of a site is paying an AGR related to the value of a site and its highest planning permission, but it is is unused or used for something much more basic, then the owner will consider sale. It is part of the function of AGR to dissuade owners of derelict, unused or under-used sites to hoard them for tax-free, long-term gains at no cost at all. It is for the community to ensure that valuable sites used for open-spaces or sport or leisure or whatever are not granted planning permission to change the use in the first place. To the degree that is a problem, it is a problem now.

        2. pipe dreamer says:

          By expanding the system to include categories which do not currently get rated, you can increase the tax rate without changing the current rates and even dropping them for some areas.

          Identifying absent holiday home millionaires from the spinster next door in an inherited house can target rebates to who deserve them. But land rent based on ‘value’ is what we have now.

          Duncan wrote. “There is a lot of farmland which is not used for its optimum purpose. ”

          even a farmer cannot determine what his land’s optimum purpose is since he is at best speculating on his anticipated selling price. Most stick to doing what they know, be it cattle or crops or dairy or whatever mix they see they can do. Nobody as yet has explained to me how this ‘optimum value ‘ will ever be determined….albeit that I myself have assessed the value of buildings and land to the market and to the prospective purchaser and that is never the same value. As far as I can see, this land tax is just going to be rates based on area, but with an infinite number of bands, each individually assessed for optimum use. It will result in years of chaos and unfairness. I see a lot of rural damage with people in a house with large parcels of land that cannot be used for shooting as they are too small or near roads. there would be farmer fallout and definitely damage their finances. Food prices would increase and not much tax gain because of big business reduced rates.

          This is a really strange idea because economic output from any site is not directly related to land area in any way. Far too many unintended consequences, unless of course it is just a tweak to make the council tax a horse by another name.

          1. John S Warren says:

            It isn’t “strange” – this is an idea with a robust history – and we do not have AGR, what you appear to wish to call “land rent”, now.

          2. John S Warren says:

            There are few “unintended consequences” of AGR; the thoroughly incompetent “unintended consequences” are all the product of the current dysfunctional system. It is unworkable; it isn’t working and it has had appalling consequences for everyone except the free-riders of the system that you appear to wish to defend so that they can continue making easy money for nothing, and being given a free luch by the taxpayer.

            The system you defend is a mess. Its sell-by date has long passed (there are very, very few people prepared to argue its merits, they just want to argue nothing works, so leave it in place) and the public are beginning to understand just how much they have been ripped-off.

            AGR is the best, workable solution.

  18. Duncan Pickard says:

    Thanks, Crubag for checking your sums. Will you also check that only farmland will be charged AGR and be responsible for funding government spending?

    1. Crubag says:

      I’d imagine all land owners would be charged something for the system to work. As farming is some 70% of land use in Scotland it seems inescapable that they would have to start paying this, otherwise it is simply loaded onto householders and non-farm businesses. If it was only for local authority spending, c. £12 billion p.a., then the starting point for the 650 acre farm would be c. £300,000 p.a.

      Interestingly, the land reform bill is bringing in business rates for farming and forestry businesses. They will now be taxed for shooting potential, whether or not they actually shoot. An incentive to shoot more, I suppose, and get clients in to pay for it.

      1. Duncan Pickard says:

        Sorry, Crubag, you will have to do your sums again. You are still our by a factor of 10. AGR will be charged according to the value of the land, that in the highlands will be charged at a much lower rate than the arable land in the east of Scotland.

        1. Crubag says:

          £12 billion divided by Scotland’s no of acres? What is your estimate.

          If marginal land is valued at a lower rate, that means arable (or other business use) will have to pay more, or spending is cut.

  19. Duncan Pickard says:

    Crubag, you have missed the vital point that urban land will pay about 90% of AGR. Dividing £12m by the total area of Scotland is meaningless. AGR is charged according to the value of the land, which depends on its location.

    1. Crubag says:

      Urban and developed rural areas are estimated at 3% of Scotland (I’m guessing that will include roads, car parks etc. so even less may be taxable). So not that much area to cover the bills.

      50% is marginal heather and peat – the kind of thing that ends up being used for shooting.

      But I do like the idea of all businesses paying some business rates, including farmers, though I don’t expect that to change their main land use – whether crops, cattle, deer or grouse. They’re probably at thei current optimum land use already.

      1. Ian Kirkwood says:

        Crubag,
        There is part to play for country sports in Scotland’s future I am sure. And those with land currently devoted to that purpose put forward their view that the land is being put to its best use now. That their predecessors removed populations to create the conditions they describe as best use makes their argument at best weak. They are wrong because the communities are gone that would have otherwise continued – as have surviving communities that were less hindered by landlord restrictions – not to mention evictions.
        Whatever the future of country sports, should this and indeed all sectors not pay their way in society like the rest of us? An annual charge on the rental value of land restores to such owners the privilege their predecessors successfully shook off: a measure of social responsibility in return for their monopoly privilege to use the land as they wish.
        The automatic reforming nature of AGR in relation to land use is thus revealed. Nobody is forced to retain the privileges of land ownership if the social cost is too high to justify the activity on it. In which case it will become available to others with alternative ideas. This progressive and automatic reforming feature of AGR will gradually reshape Scotland without the need for compulsory purchases or expensive publicly-funded community buyout funds.

  20. Duncan Pickard says:

    There is a lot of farmland which is not used for its optimum purpose. Urban land, which is much more valuable, has many derelict and disused sites, (including land owned by supermarkets to stop competitors from building nearby) which currently pay no rates. That is a good reason to look seriously at AGR (LVT) as the Local Tax Commission recommended. Where does your estimate of 3% of the area of Scotland being developed come from? That figure is much lower than others I have seen.

  21. pipe dreamer says:

    Duncan

    I have seen the 3 percent figure before in relation to percentages of built up areas in Scotland. I think it is hard surfaces. i.e. roads railways, carparks, buildings and other hard surfaces Over england in the south it goes up to about 5%. Even London as a whole is only about 11% built over.

  22. pipe dreamer says:

    And it appears that even those small numbers are wrong.

    http://www.bbc.co.uk/news/uk-18623096

  23. florian albert says:

    John S Warren Thanks for your response.

    If I have understood correctly, you are saying that, as well as the value of the land, the level of planning permission will dictate the AGR.

    To generate significant sums from the likes of Amazon, it would require the latter to be set – at the highest level – far higher than at low levels of planning permission.

    How would this apply to sites where planning permission is largely irrelevant; i e those sites already built on. To go back to my hypothetical two sites which are each the size of two football pitches; if one site has a high rise block with 80 flats on it and the other has a total of 8 bungalows, would the total AGR be identical for each site ?

  24. John S Warren says:

    8 bungalows or 80 flats? It would depend on the bungalows or flats of course, but assuming the value of 80 flats is far greater than 8 bungalows, the planning permission for 80 flats would invest a far higher value in the flats and a higher AGR. I assume that a land owner with planning permission to build either 8 bungalows or 80 flats (implausible circumstances of course but you set the question) would therefore not choose to build bungalows.

    1. John S Warren says:

      I might add that where, as you say, there is a building on the site already it is reasonable to suppose that it has planning permission. For example, if the house collapses in a storm you do not require a new planning permission to rebuild the house; but you would need planning permission if you wanted to replace it with 8 bungalows, and if you received that permission then it is no surprise if the AGR for that site is signficantly higher.

    2. florian albert says:

      John S Warren

      It would appear that AGR consists of two parts; the value of the land and the level of planning permission attached to the land. Of these, the latter seems to be much the more important.
      It also appears that ‘planning permission’ is a theoretical construct for the overwhelming majority of
      urban plots of land where there are already buildings – mostly houses – in situ.
      For people living in such houses, the new ‘tax’ will look suspiciously like the old council tax. As the council tax looked very like the rates.

      1. John S Warren says:

        It is not a charge on the property. Let me give some examples.

        Improvements made to the property on the site (an extension, conservatory or whatever) would lead at some point to a revaluation of Council Tax (it has been put off, but it is fundamental to the system – that it doesn’t happen now is an insight into the scale of the current mess, and it cannot go on).

        Such improvements will not lead to an increase in the AGR. The property is a function of enterprise, investment and labour – it is not charged. The AGR would only increase if there was a material improvement in the amenity of the whole area; i.e.., in the land itself because of the services, infrastucture or amenity (in London a new undergound line or station nearby to take a big enhancement to amenity, for example).

      2. Ron Greer says:

        Florian Albert: there will be no charge on the bricks and mortar or improvements upon them, just on the land underneath them, which was created free of production costs, either by God or the Big Bang. The only value land has is 100%created by societal demand, not by the owner and AGR will return to society that which it created. What the owner put on that land and what the owner/occupier does on that land is his/hers, totally free of income tax. We will pay for what we hold and take and not for what we do and make. We shall keep what we create and pay for what we receive.

        1. florian albert says:

          Ron Greer

          I entered this discussion largely ignorant of AGR (like most people) and seeking clarification.
          What you are saying is significantly different from John S Warren, who emphasizes that levels of planning permission would lead to much different levels of AGR.
          I deliberately gave concrete examples as I felt this was the best way to get clarification.
          You introduce income tax to the discussion which seems to confuse the matter further.

          My – tentative – conclusion is that AGR will remain on the fringes of political discourse in Scotland.

          1. John S Warren says:

            It is not for me to speak for Ron Greer, but from the comment made there is perhaps less “confusion” than you think. As far as I can see all he is saying is something that follows from the strength of AGR. Taxation is applied to the wrong things; enterprise, investment and labour – the economic drivers of prosperity. AGR can be used not only to replace Council Tax, but could gradually tak up the burden of other taxes, including Income Tax. Hence Income Tax rates could be reduced over time and the burden of funding community services transfreed to AGR.

            It is very powerful. It was almost intriduced in the UK in 1909 but was only defeated by the House of Lords; representing the vested interests of land owners.

            Currently its proponents include Martin Wolff (FT), Stiglitz, and someone closer to home who has been mentioned in this thread; Andy Wightman.

  25. pipe dreamer says:

    Note all land has planning permission.

    the clue is in ‘permission’.

    Areas can be set for different land use, but it does not differentiate between flats and bungalows.

    my own property has the designation of ‘mixed use’. Optimum isnt shooting.

    P.s. If anyone cared to look at the BBC link i posted above which gives scotlands built up area at less than 1%, you would see that approximately 60% of scotland would have ‘optimal ‘ use for shooting grouse….but I’m not sure there is the market nor enought grouse.

    1. John S Warren says:

      Permission for development. Most of the value is in urban centres. Outside urnan or suburban centres, as Duncan Pickard pointed out “The SNFU also uses the principle of AGR when it charges membership fees per unit area according to the quality (which NFUS calls ‘capability’) of the land farmed.”

      AGR adjusts for the quality of land, or the planning permission that either exists, or is sought. We keep going round the same issues endlessly; the problems you are recycling are not problems.

      1. pipe dreamer says:

        Do you not see when you use phrases like ‘Most of the value is in urban centres’ ‘AGR adjusts for the quality of land’ that in fact , the amount of land is irrelevant and that optimum use can never effectively be defined.

        If the current system had a category for arable land based on area, Had a category for gap sites, Had a wider range of bands for domestic properties to catch large estates which are not farms, it would achieve everything you are looking for without half of the problems that would exist but you are blind to? or do you seriously think that half the area of scotland should be rated for grouse shooting? Do you acknowledge that some land is worthless?

        And with all this additional tax going on farmers, Will it help the poor of Scotland to have dearer food?

        1. John S Warren says:

          Duncan Pickard is a farmer and a land owner. I do confess that I now wonder if you actually read his article.

          You have obsessed over the word “optimum” and tried to turn it into a problem. There isn’t one. For a typical urban site the highest planning permission will set the AGR, but it is for the land owner to decide what to do. For the first time if he decides to hoard the site or underuse it there will be a cost attached. That is all, but that simple fact will change the land market for good, because there will longer be free lunches from the taxpayer; and because of that land owners will tend to desire to optimise use. That is all it means.

          Tinkering with the current system is a way of saying that you do not realise the damage it does, and that what really matters is protecting the status quo. That will not work; the current system has been found out, as the Local Tax Commission Report has revealed. The only argument for the current system is that, however disastrous it is, the public understands it. That is not an argument, its an excuse.

          You cannot solve the problem of the current system by thinking ‘on the hoof’, making up even more byzantine adjustments as you amble along, making this more complicated with this, that and the other qualifications, with more and more wretched unintended consequences. The system’s a dud.

          I think you require a new pipe dream.

          1. John S Warren says:

            That should read “there will NO longer be free lunches from the taxpayer”.

          2. John S Warren says:

            Finally, and it is finally, you are also overemphasising “quantity” of land. This is a system of Annual Ground Rent; it charges land owners with a rental for the site. as Duncan Pickard pointed out quality of land counts; urban land will be higher charged than sites in the country. Where two sites are exactly the same in every relevant particular for setting the AGR except the size of the site, the larger site will pay more. That is all. It does not mean larger sites always pay more.

  26. pipe dreamer says:

    oh I read it very closely. A lot of the assumptions on impacts are what i would describe as hopeful.

    So it isn’t a land tax at all , it is a property value tax…what we already have for Homes and for business it is rental which is what we have for business.

    If you want to rename the council tax into the land rental adjustment on value tax…go for it.

    but charging people for undeveloped land, and worst still developed land for something that they do not want to use it for or cannot use it for is plainly never going to work.

    the point is that it’s name is irrelevant. What it does is the concern. However, it would seem that the name change placebo is the current thinking.

    anyone knows that the situation in 1707 for local taxation was completely different from now.

    I would ask something very simple.

    Who exactly is the council tax system broken for? and how does this proposal help them.

    Wightman suggest that the average home cost will increase by 50%.

    I can see people being hit with higher food costs and forced out of homes because their land is ‘valuable’ for other uses and pressure can be applied.

    Maybe it would be a better idea to target the people coming in and taking the free lunchs rather than close down the restaurant serving single people for what they eat and open a new one with a new name charging on the basis of the use of an entire table and what is on the menu, not what they actually eat.

    1. John S Warren says:

      I would not dream of speaking for Andy Wightman, but I do hope he reads your remark and responds for himself. Meanwhile, for one time only, I have a question for you; please provide chapter and verse, precise and with source and detail: where did Wightman write “the average home cost will increase by 50%” if AGR is implemented, and the context?

      1. Phil Robertson says:

        “where did Wightman write “the average home cost will increase by 50%” if AGR is implemented, and the context?”

        He did a paper for the Greens (forgotten the title) and it gives an expected breakdown on where the cost will fall. The fraction raised from residential payers goes up from around a half the total to just under two-thirds. That’s not 50 % but it is a significant rise.

        1. John S Warren says:

          The residential element going up does not mean that the average home cost will go up (it is not even clear what that statement means – i.e., what is meant by the “cost” of a home to which it refers); you have not defined the terms, or even explained what proportion of government/local government revenues it is proposed to raise, to produce such an increase.

          As it stands this is not an answer to the question, or meaningful. In fact for most home owners at current Council Tax levels (please not that statement), the majority of home owners (by number of homes) are quite likely to see their tax fall with AGR. It would rise for larger, high-value homes. Please provide the precise facts backing this statement and not half-remembered speculation.

          1. John S Warren says:

            “Please note that statement”

        2. Roger Sandilands says:

          If one is comparing the current Council Tax system (whereby the land plus the building is assessed) with one based on AGR, and if the same overall revenue is sought – that is, if we are considering a “revenue-neutral” reform – then the average ratepayer would be paying exactly the same as before. Thus, to say that the average cost of a home would rise is mathematical nonsense.

          Whether or not a particular ratepayer would pay more or less depends on his or her particular circumstances. What is the ratio of assessed land rental value to the value of the buildings and improvements?

          What is for sure is that the capital value of the land element would fall in proportion as the annual ground rent is increased. But the value of the house itself would increase if the house is no longer being taxed. There is then every incentive to invest in improvements. The greatest gainers would be those who live in a less desirable area but have a big house, or who occupy a flat in an apartment block, sharing the ground rent. The greatest losers would be those who own a site that is more valuable than the building on it. Speculators who are land banking or holding a site vacant will lose most and would be motivated to sell and pass on the title to someone who wants to use it for its full economic potential, and is able and willing to pay the market AGR. QED.

  27. John S Warren says:

    No it isn’t a property tax. There is no charge for what is built on the site; the charge is for the services, infrastructure and amenity provided by the location that makes it possible for someone to own, develop the site and profit from the permissions that the site possesses from the community. If they build nothing at all they still pay the charge.

    This really is not difficult to understand; and since numerous commenters have addressed these issues with you time after time, I do not think it is either unkind or unfair to suggest that it begins to appear that in order to defend a weak argument, you have resorted to persisting in sheltering behind dogged obtuseness. The fact is it isn’t complicated, it isn’t difficult, and unlike the system you defend, it isn’t full of holes.

  28. pipe dreamer says:

    Sorry my maths is wrong.

    From 50 percent of tax take to 65% of tax take is not 50% just 30% increase on the original as phil says

    but from paying 50% to 35% is very close to a 50% discount for business.

    Explain to me again why this is ‘fairer’ to the poorer people paying rates?

    “The residential element going up does not mean that the average home cost will go up ”

    Well, I got my maths wrong so it seems fair you should get a go to do it as well. the average being the total divided by the number paying? The number paying isn’t going up but the total paid will be. perhaps you mean median?

    you see that what I am trying to point out is that currently, in terms of value, land area and even economic use, The domestic user gets a pretty good deal with the exception of the very bottom of the market and I include the median house values in that.

    What is being proposed is a scheme that isn’t based on land area alone, but is a land tax supplemented by a service tax (business) or property value tax (domestic) and is a merger of the three taxes that the danish system has, only one of which is the Land tax that seems to be what is being proposed as some utopian-based fair system when it isn’t. Since value of the property and the use of the properties are in the danish system, it is not that different from what we already have, so fix what we have or start from scratch with a system that isn’t much different?

    I refer you to my restaurant analogy earlier. …and remind you that the Poll tax was a system that was brought out because it was considered by some to be so much fairer and a vote winner. We all know how that went downhill pretty fast.

    1. John S Warren says:

      Instead of dashing off averages (of what – the actual content of the numerator is not clear) without defining means, modes or medians; or using mis-calculations; really doesn’t cut it.

      I have simply asked that you present the actual statements made and sufficient information supporting it in order that a reasonable reader may digest the facts, understand what case is actually being made, and form an opinion. You still haven’t supplied sufficient data so I do not intend to invest in spurious ‘fag-packet’ calculations on the basis of guesses to satisfy what is no more than casually speculative argument.

      This is no way to advance a sound, rational case. It is the only question I have asked of you and your argument, and in the event it has proved as confused as the system you defend. QED, as Roger Sandilands above wrote, having given a clear and trenchant statement of the main issues.

      1. Ron Greer says:

        John,
        He should change his cop-out moniker to Pipe Troll, Troll Pipe or Tripe Pipe

  29. Oldroad says:

    If we all stopped whinging and weaselling and all just paid our Council Tax, we could save eons of time, energy and money which will be wasted trying to invent another ‘fair’ new system. The extra income thus collected will be a benefit for the whole community at all levels of wealth, now, not in another five or ten years.

  30. pipe dreamer says:

    Well, this pipe troll seems to have been just on the money with today’s anouncement.

    An amendment broadening the tax take for empty land sites and the upper bands…..wonder why?

    1. John S Warren says:

      The point of the exercise is not to second-guess what policy the Government selects, but to ensure that Scotland has the the most efficient, cost-effective and equitable system of local taxation. The Government has chosen a system that is less efficient, cost-effective or equitable than AGR. It is unlikely that the system chosen will have a long shelf-life.

  31. Phil Robertson says:

    One interesting aspect of the proposals is that the extra revenue HAS to be spent on education. Not great news for those dependent on social services.

    Nor does it do much for local democracy.

  32. pipe dreamer says:

    In posts above , i was accused of not reading the government papers. The reason this has happened is plainly visible to see in those papers. They couldn’t gain consensus across the parties or even in a single party and in fact it looked like while everyone agreed something should be done, there didn’t seem to be a single consensus on what was achievable, nothing tangible seemed to have more than 25% support. It didn’t help that AGR is misrepresented and I honestly think that what it’s called is less important than what it does. Denmark is the example of AGR , but when you drill down into Denmark’s tax system, It is in fact almost identical to the council charge for domestic properties.

    Andy wightman is a big proponent of the AGR concept, but the problems it created didn’t get the support since it was seen to have the same flaws as the current council tax. He should consider that what he has actually achieved is a partial victory. He didn’t get his system but it is so obvious that his concepts have influenced the changes taken on board.

    Dont like the 3% limit. I hope the business rates will get the same freedom for increase or at least an adjustable percentage since 3% on CT is less than 0.4% of council income…don’t like that the A band hasn’t been given sub classification . A1, A2 and A3 based on no. of bedrooms would have been a good idea. ….discounts to A could have been applied based on no of taxpayers, kids and bedrooms, disabled residents, pensioner’s, carers.

    overall, think there is more that could have been done and I am hopeful that what was said to be discredited could actually become a much better system.

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