Compared to taxes on buildings Land Value Taxation provides a broad tax base because it would include all empty properties and empty sites.
LVT would encourage new capital investment rather than sterile land speculation as it would encourage a shift of private investment from land speculation
(which creates no extra land but only higher land prices) to productive enterprises.
LVT would encourage the use of empty sites zoned for development, creating more job opportunities and wealth.
LVT would help avoid urban sprawl. As brown field sites would be developed within towns and cities it would be unnecessary to permit urban sprawl. Compact
towns are also more efficient in their use of resources for transport and other services.
LVT could not be avoided. (Unlike income tax and business taxes where tax avoidance experts are in great demand and the ‘shadow economy’ flourishes to
evade taxes.) Every landowner would be required to register their land and to pay LVT on all their land holdings. With LVT any site with no registered
owner would be sold by auction for the benefit of the Government.
LVT would provide automatic compensation for those sites which are disadvantaged by a new development. For example: with a new railway line most sites
(especially those near stations) benefit from big increases in land values but some sites (maybe housing close to the track and suffering from its noise
and vibration) would lose some value. These sites would pay a lower Land Value Tax, providing automatic compensation without any complicated appeals system.
Lower interest rates. The Bank of England tries to control land price and hence property inflation with a higher base rate. LVT would act as a damper on
escalating land prices, allowing the Bank to lower interest rates for the benefit of homeowners, industry and small firms.
The Government’s auction of mobile phone airwaves for 25 years raised £21billion (and of course, the airwaves can be auctioned again in 25 years time!).
Landing slots at airports are also a natural resource that the Government should auction on a periodic basis.