Concerns around the introduction of Land Value Tax (LVT) on Farm Land is often based on a misunderstanding of how it would be implemented. The current average market price of land is at least five times what is justified for farming, based on the price of farm produce and costs of production. LVT is charged on the annual rental value of land, not on it's current price.
DEFRA figures for the rent of Farm Business Tenancies are about £100 per acre for general cropping, £50 per acre for lowland grazing and less than £40 for LFA land. LVT on the poorest land will be negligible.
LVT is NOT an additional tax but a replacement for existing taxes. About 90% of the land in the UK is rural but has only 10% of the total land value. Conversely, 10% of the land is urban and has about 90% of the value so it will provide about 90% of the LVT. All the land has been mapped digitally and its valuation for LVT will be a fraction of the cost of valuing land- based property including houses and buildings. There will be many objections to LVT from the minority who live in the most favourable and expensive locations. They have the loudest and best funded voices. The poorer majority will remain silent but be better off.
The most likely start for LVT will be to replace Council Tax, which has not been updated for more than 30 years, Business Rates, and Stamp Duty. Following the benefits seen from this, it will be possible to gradually reduce the taxes which have huge detrimental effects on employment and trade (Income Tax, NIC and VAT).
Without radical reform of the whole tax system it will be impossible for any government to achieve targets for "growth", reductions in inequality and the elimination of homelessness and poverty. Trying to obtain more revenue by raising existing taxes will only increase the need for more spending on unemployment benefits, as happened when NIC was increased.
Duncan Pickard, Straiton Farm.