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Land tax prowl before a pounce? Advice from property expert Colin Muller
ith all that is going on with Brexit and whether a deal will be done, it’s perfect cover for politicians to hatch plans for raising taxes. There has been no particularly strong motivation by either Labour or Conservative governments for the last 40 years to seek direct taxation on sales of development land. The last incarnation of a land tax, in the mid 1970s, was Development Land Tax (DLT) introduced by a Conservative chancellor, which was progressively raised over a number of years by successive Labour Government. At its most punitive rate, DLT captured 80 per cent of gains. As frightening as that may sound, it was very short lived, as the supply of new land brought forward for development dried up overnight and the tax was abolished in 1985.
There is no doubt a chill wind is blowing but, with the very severe problems in meeting the demand for new homes, and no real sign of the required housing production levels being met any time soon, introduction of any new form of land taxation would be a landmine. The Conservative Government’s plan to boost housing and get young people on the housing ladder would be very seriously derailed, as would the provision of affordable housing, and local infrastructure contributions secured under the grant of planning permission by S106 agreements, and the Community Infrastructure Levy (CIL). Last month’s report of the Housing Communities and Local Government Committee chaired by Clive Betts, Labour MP for Sheffield South East, concluded there was scope for a bigger slice of tax to be taken from uplift in land value. Clive Betts’ statement that ‘the current land value capture system allows landowners, through no ef-
Tel: 015395 66222 Tel: 015395 66222 E-mail—firstname.lastname@example.org E-mail—email@example.com Website—www.nwauctions.co.uk Website—www.nwauctions.co.uk
WITHNELL, CHORLEY FOR SALE BY PRIVATE TREATY
A detached farmhouse, a range of modern and traditional buildings, with development potential, and 83.44 acres/33.77 hectares of meadow and pasture land, known as
Higher Stanworth Farm Bolton Road, Withnell, Chorley Higher Stanworth Farm comprises an imposing brick built detached house with substantial accommodation including 5 bedrooms, range of livestock buildings and 83.44 acres/33.77 hectares of productive meadow and pasture land. The house requires some modernisation. Available in one or more lots.
Guide price - £1,350,000
Full details and plans available from the Agents.
October 12, 2018
fect of their own, to make multi-million pound profits from the substantial increases in value that arise from public policy decision, such as granting of planning permission’ is a sure sign both parties are on the prowl for tax from the sale of land. It is without doubt one of many actions taking us in the direction of more direct political intervention in the land and housing market. It strikes me as precipitous to be even thinking about a land tax, when housing provision needs to reach 3.91 million new homes by 2031. That is a requirement of above 340,000 houses per year, against production for 2016/17 of only 217,000 homes. Tackling housing provision is only in its very infancy and the last thing we can afford to see is land supply drying up. And the Government must be mad if it believes its newly-created body Homes England can become a major force in housing provision. My view is we need a complete overhaul of the planning system, not tinker with taxation of land.
Surely the objectives of Conservatives and Labour alike to provide more housing, and fund more local infrastructure, can be met by providing more land with planning permission – more affordable houses are provided, bringing more S106 contributions and CIL payments. It is just supply and demand. There is a dire shortage of land right across the country, with many local authorities not able to meet their five-year housing land supply requirements. It points to the heart of the problem, there is too little land being allocated for development in Local Plans. The problem is, governments do not listen to advice from those like myself who have been in land and development a lifetime so, just to be safe, if you have land with development potential, get moving now towards securing planning permission. Colin Muller is chief executive of Muller Property Group. Email muller@ muller-property.co.uk or call 0800 788 0900.
land & property specialists Malpas | South Cheshire | As a whole or in 3 lots
Lot One: Four bed period farmhouse in 13.33 Acres | needs modernisation | potential to extend | EPC G traditional brick buildings ideal for conversion subj to PP | modern farm buildings potential for stock/equestrian use | Lot Two: 45.17 Acres pasture land Lot Three: 15.57 Acres pasture land
01630 692500 firstname.lastname@example.org
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