Would LVT really hit the homeowner?

LVT advocates tend to hold back through fear of an angry reaction from homeowners, but consider this. Most land value is in land used for productive purposes, that is, land used for wealth creation other than agriculture. That must be so. The most productive land is not used for housing. But the value of land in commercial use is presently depressed by taxes that fall on business. The chief amongst these are taxes nominally paid by labour such as Income Tax, NI and PAYE, as well as VAT, but whose burden actually falls on employers, forming part of their labour costs and depressing their profits. Were these to be removed, business profits would rise sharply and with them, the ability of business to pay higher rents. A further factor depressing the price of land used for commercial purposes is that a significant proportion of land rental value is collected already, if inefficiently, through the Unified Business Rate (UBR), which would be superseded by LVT.

Thus, as existing taxes were phased out, the rental value of land in commercial use must rise sharply, and with it, provided that LVT is phased in gradually and valuations are frequent, the share of LVT collected on such land in relation to the total from all land.