Ok I’m posting a question here to see how people would feel about the contributing to the funding of infrastructure, through some kind tax on the unimproved value of land. Now of course noone likes paying tax, but what if the tax contributions directly added value to your property, like a renovation does?
So consider the following:
Say there is a proposal to build a railway close (but not too close!) to some property you own. Now we all know that ammenties add value to land. However suppose there is not enough money in the governments coffers to build it.
Someone then does some calculations and realises the the total price rise in the properties in the area directly attributable the addition of the said railway exceeds (say by a factor of two) the cost of the railway.
My question is this; how would you feel about paying a tax on the unimproved value of your land to fund the project, in the faith that you will reap a greater capital gain than the cost of the tax in the following years?
Hi Splosh [biggrin]
Actually this idea is not new and was done in the late 1900’s, and you can read about it if you borrow a book titled “The Land Boomers†from the local library as its been a while since its last print.
My copy was inherited/ borrowed / stolen from my Mother-in-law. The name of the author is Michael Cannon and the publisher is Melbourne University Press.
For Instance the railway line built to Laverton in the Western Suburbs ended in a Paddock, the only building, apart from the Station, was a land sales office owned by a Politician, similarly there was a Railway from Melbourne to Oakleigh, which by a direct route nowadays takes half an hour, this took over 4 hours via a circular route past various land offices. Needless to say it turned into a flop.
It was the time of people such as Tommy Bent who built a private Tramway between St Kilda Junction and the city that bears his name –Bentleigh.
Most of the tram and train lines in Melbourne were started as floats with commercial outcomes in mind.During this time the first mansions appeared such as Rippon lea and most of the fine old buildings in both Melbourne and Sydney were also built during these boom times.
It was also the scene of the horrific crash which followed and caused an unemployment rate of over 50% with banks crashing commonly. It was also the time of Sir Issac Issacs who laid down the foundations of our modern Company and Banking Laws.
So I am sorry to bear the tidings that your idea is not new but it was well thought out anyway.
Regards
Bryce Inglis
Financial Advisor
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