Subject: Hoarding development land – tax free
Sir, You report (7th April) that Shelter, the charity that aids the homeless, is backing calls for a tax on developers sitting on thousands of sites with planning permission for housing.
The anti-social, but tax-favoured, hoarding of land could not happen in Australia, where the government of New South Wales saw the light many years ago. It collects an annual property tax based on land values over a pre-set threshold. The value on which the tax is assessed relates to just the land – buildings and other structures on the land are ignored. There is therefore a huge incentive to improve properties. Adding buildings or refurbishing has no effect on the tax.
The only disincentive the tax creates is to speculate in land by hoarding it – for the owner is liable for the tax regardless of whether the land is occupied, the very point Shelter’s argument is making.
An example worth following in this country?
Emile Woolf FCA