Is LVT a wealth tax?

Wealth taxes are a very bad idea, and this example shows why. There is an old woman I know who lives on a small state pension and disability benefits, in sheltered accommodation. But her great grandfather was a well known Victorian painter and she inherited a couple of pictures. They need expensive conservation which she cannot afford.

But under wealth tax someone would have to check to see what pictures people had on their walls and in their attics, value them and clobber their owners. My friend could I suppose try to charge people who wanted to come and look at them, but in principle, the ownership of wealth as such does not necessarily provide the means with which to pay a tax on it.

This is the trouble with levying a tax on a value that cannot be realised except by sale of the item or items. Precisely the same objections apply to LVT levied on capital values. And a further disadvantage is that people get the idea that LVT is a wealth tax, which it is not. LVT must be based on annual rental values and it must be made clear that this is a revenue stream or imputed revenue stream exactly like earned income, with the difference that it is not earned by the owner but created by the public at large.

Henry Law