Tenants would not pay council tax and owners with gardens would be a higher amount, under plans being discussed by the Labour Party.
Among a series of reforms of the housing, planning and land sale market, a document commissioned from academics and economists suggests that council tax would be replaced with a progressive levy based on property values.
The report, called Land for the Many, also suggests scrapping the single person council tax discount, taxing land owned by foreigners and building thousands of council houses on public land.
To make sure the new look council tax is up to date the valuation of properties for tax purposes would be updated annually, and it says that empty homes and second homes should automatically be taxed at a higher rate.
It recommends more major reforms of the private rented sector. For example, tenancies should be open-ended, and landlords should lose their power to evict a tenant who has not broken the terms of the tenancy agreement for the first three years of the tenancy agreement, and should have to provide grounds for eviction after that point.
It also says there should be a cap on annual permissible rent increases, at no more than the rate of wage inflation or consumer price inflation, whichever is lower and proposes that buy to let mortgages should be more firmly regulated and restricted.
It also calls for councils to make more use of compulsory purchase orders on land needed for building and said they should be allowed to buy the land at a much cheaper price than at present.
Councils would be given the power to require land that has been left vacant or derelict for a defined period to be sold at public auction. Changes to existing laws would enable them to buy at prices closer to its current use value, rather than potential future residential value.
In order to ensure poorer families have a voice in the process, it said everyone should be eligible for jury service style attendance at planning meetings and the report recommends the establishment of a ‘community right to buy’ which would make it easier for residents to band together to purchase land. Firms based abroad who own land in the UK would face a new offshore company property tax.
Jon Trickett, Labour’s spokesman for the Cabinet Office, said the party will be considering the recommendations. ‘For too long, people across the country have had little or no say over the decisions that affect their communities and the places in which they live. Concentration of land in the hands of a few has led to unwanted developments, unaffordable house prices, financial crises and environmental degradation,’ he added.
However, Housing Secretary James Brokenshire described the report as extraordinary and deeply damaging. ‘Plans to seize land into public ownership also show Labour’s true colours of more and more state control. This tax bombshell for families would mean family homes with gardens paying far more and higher taxes on pensioners by abolishing the single person discount,’ he pointed out.
But a debate on land ownership is welcome, according to Joe Beswick, head of housing and land at the New Economics Foundation. ‘It’s great to see politicians starting to take the issue of land seriously. NEF have long made the argument that land is essential to properly understanding our current broken economy, but is largely ignored or side lined by mainstream economists,’ he said.
‘Land and land ownership is one of the drivers of so many of the crises that we face today, the housing crisis, the inequality crisis, and the climate emergency, and developing a fairer system for distributing and using land must be central to a new, sustainable economy,’ he added.
