07/07/2022

eEven if you live hundreds of miles from Paddington or Stratford, you may know that London has just opened a huge and shiny new railway. Once the 100-kilometre route is connected, a bank employee traveling to Heathrow can take the train directly to Canary Wharf, while a South Hall resident can visit relatives on Kings Ships without having to change trains, let alone lines.

Amid all this charm, some aspects of the Elizabethan line remain reassuring and faithful to the best traditions of British infrastructure. Of course, years have passed on the schedule and the budget has crossed billions. But one innovation that deserves a special mention is not its technology, but its cost-effectiveness. A lot of construction money came from companies along the way. Through a special tax levy, sometimes known as the Crossrail Annex, major companies have raised more than £4 billion from the £19 billion project. The principle of donating is simple: companies along the line benefit from more customers and easier employee mobility.

It seems easy. It is uncomplicated. So why is this principle rarely applied to our taxes? More than a century ago, Boris Johnson’s hero, Winston Churchill, said: “Roads are being built, roads are built, services are improved, electric lights turn night into day, water is fetched from mountain reservoirs a hundred miles away—and all the time.” It sits still… It does not serve society, contributes nothing to the common good, contributes nothing to the process from which its enrichment stems.” There has been a sensational call for a land value tax, a tax that must be increased to balance property prices, and it has been endorsed by experts It has been eminently economists for decades and has been adopted in various forms in cities around the world, from Australia to Eastern Europe.

In the UK, Whitehall reviews have taken over this topic, but not much progress has been made so far. Although the Crossrail modification is a partial acknowledgment of the land value tax issue, it is nothing of the sort. The result would be a huge loss in the potential earnings of the public treasury. In the southeast station is the new Elizabeth Lane Abbeywood station, which is now only 20 minutes from town instead of 45 minutes. Not surprisingly, developers and investors have flocked to the area, with local property prices doubling over the past decade. Across London, the average increase was closer to 55%.

However, these huge unearned profits would go almost without taxes, depriving ministers of the ability to claim they had the money to build more railroads. Another example is HS2, which is now expected to reach an audience of over $100 billion.

The current tax system rewards the owner more than the doctor. We need to start taxing more and better wealth; Existing wealth taxes often fail. The council tax is based on bricks and mortar rather than land, and is based on 1991 property values. A tax on land values ​​would be a tax on something that cannot be escaped or protected on Paradise Island, and might include developers’ intimidating hoarding. And it would help build a much better public empire.