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Farming support

With Brexit impending, perhaps, UK farming policy is back on the agenda. We need to be clear about the effects of support for farmers, in whatever form it takes. This requires an understanding of the great economist Ricardo, who formulated the Law of Rent.

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Sugar tax

If a tax on sugar means the people eat less sugar, then a tax on wages must mean fewer jobs and a tax on goods and services, the purchase of fewer goods and services. Yet most public revenue is paid for by taxes on wages, goods and services.Then we are worried about joblessness and failure of the economy to grow.

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Business rate rise complaints misdirected

The changes in the business rate have attracted the ire of the Confederation of British Industry and the Federation of Small Businesses. Part of the trouble, not mentioned by the complainers, is due to the deferral of UBR valuations when George Osborne was Chancellor. However, the CBI and FSB are doing their members no favours by complaining about the UBR in isolation. It is total occupation costs...

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Il-informed comments epidemic

The latest revisions to the UBR have brought about a wave of ill-informed comments in the press, even in publications such as the Financial Times, where one would expect journalists to be on top of the subject. The incidence of all property taxes is on the landlord. An increase in the UBR means that rental levels will drop, or rise less quickly than they would otherwise have done. This has been...

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The VAT meme propagates

VAT is amongst the worst conceivable of all taxes; it fails all the criteria set out in the Canons of Taxation. Yet its advance continues like the plague. India has adopted it, and now Saudi Arabia is going down the same path, as oil revenues fall and the tax free economy comes to an end. Oil revenues are of course a resource rent, and so Saudi Arabia is accustomed to funding public revenue from...

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Budget – economic illiteracy

The Chancellor has plunged new depths of economic illiteracy with his changes to the business rate. The new threshold for small business rate relief will increase from £6,000 to £15,000. Business rates will also be linked to CPI, the official measure of inflation which has historically been lower than the RPI rate to which rates are currently linked. As always when property taxes are reduced, it...

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2015 Budget – keeping the land price bubble fed

We note that the budget consits mostly of minor adjustments. The new scheme for “helping” first time buyers does nothing but boost the housing bubble, which we can only assume is cynically intentional. A further land price booster will also continue: the current temporary Small Business Rate Relief, which was due to end on 31 March 2013, will now continue until the 31 March 2016. However,...

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Business Rates – here we go again

The government is launching yet another review of the Business Rate system, which is allegedly a burden on small businesses. So are rents, but that cannot be mentioned. How many studies have there been since Layfield’s in 1976? In the meantime, the Chancellor could usefully look at what a study by Cambridge Econometrics, commissioned by the Treasury found when it looked at what happened when...

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Burdening the nation’s capital

This list of the top 50 business rate bills published by the Guardian shows strikingly how heavily the UBR bears on capital rather than land. Power stations, steelworks, oil refineries and ports are amongst the hardest hit. Heathrow, at the top of the list, is paying for its location value, as are the other big city airports, but a surprising number operate on sites for which the LVT valuation would...

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