@BBCWeekendGMS was talking this morning about how we pay for social care, and saying that, basically, income tax is the only way @scotgov can raise more money (before independence). I don't believe this is true. #1/22

@scotgov has power over local government taxation, and has totally failed to tackle this problem over ten years. Ten years ago, when they were first elected to government, the SNP were proposing a local income tax. Fortunately, they didn't implement that. #2/22

I say 'fortunately', because income taxes hit workers. They don't hit the rentier class at all, and it's in the rentier class that Scotland's excess wealth resides. As I understand it (correct me if wrong), Scotland doesn't have the power to vary tax on unearned income. #3/22

What we need to do is tax wealth. Most wealth in Scotland is in land, and land is local. We know where it is, we know how much is in each holding, and we increasingly know who owns each holding. You can't hide land offshore. #4/22

@agr_slrg - and @andywightman - have been arguing for years in favour of an 'annual ground rent' or 'land value tax'. This would be one hell of a good beginning. The revenue which could potentially be raised is very large indeed. #5/22

My first argument against an 'annual ground rent' or 'land value tax' is that it's not progressive. Someone who owns one house, or one hectare, would pay exactly one hundredth of what someone who owned a hundred houses of a hundred hectares. #6/22

That's like someone who earns a million pounds a year being on the same 20p in the pound tax rate as someone who earns £12,000. People with more wealth MUST pay more, as a proportion of their wealth, than people with less wealth, otherwise we cannot reduce social inequity. #7/22

So I strongly believe there has to be a progressive element to property tax. A person with a small amount of land - a house and a back garden - should pay nothing. A person with a large amount of land - 400 square miles, for example - should pay a huge amount. #8/22

But there's a second problem with the 'annual ground rent' or 'land value tax' model. It's based on the rental value of the land, and many large land owners go to enormous lengths to reduce the rental value of their land. Grouse moor burning is a prime example. #9/22

Landowners claim they shouldn't be taxed on this land - land which was in its entirety STOLEN from the commons in the last three hundred years - because it is 'worth nothing'. They're 'doing us a favour' looking after it for us, and it's 'costing them money'. #10/22

Except, of course, when the local community wants to buy back what's been stolen from them, and the Scottish tax payer is offering support through the Land Fund, suddenly the land is worth large amounts of money, as the folk of Wanlockhead and Langholm are finding out. #11/22

@agr_slrg argue that this ability of landowners to reduce or hide the value of their land can be overcome because - well, I neither understand nor believe their arguments, so I'll leave this here to give them an opportunity to try to persuade you. #12/22

But I believe - strongly - that while Land Value Tax should be PART of the picture, there needs to be another part of land tax which is levied JUST on area - where a hectare on the Cairngorm plateau pays exactly as much as a hectare in the financial district of Edinburgh. #13/22

You cannot, by mismanagement of the land - by clearance, by heather burning, byobjecting to road and rail connections, by whatever - reduce this tax. And this tax should be very strongly progressive. #14/22

Essentially the idea is that the tax on a land holding should be

Σ₁..ₙ(cn)ᵉ

where n is the number of hectares in the holding, c is the amount of tax paid on the first hectare of each holding, and e is a standard exponent - the same exponent for every holding.

#15/22

Obviously, multiple holdings with the same (or broadly the same) beneficial owners would be treated as a single holding.

I've explained this idea in more detail here:

https://blog.journeyman.cc/2014/12/me-and-you-and-duke-of-buccleuch.html

#16/22

But basically, if we start with a £1 tax on the first hectare, and set an exponent of only 1.05, we get this:

Average croft:£10.53
Average farm:£6,204.08
Edinburgh Airport:£105,040.07
Grangemouth Refinery:£331,177.47
Duke of Buccleuch:£10,350,620,262.71

#17/22

The advantages are

1. The tax is fair: the same formula applies to everyone;
2. It's very hard to evade: land can't be hidden;
3. It's very easy to collect: we know who owns land;
4. It would break up large landholdings and redistribute land ownership.

#18/22

The final step here is that the tax would be paid to the lowest tier of local government - to the community council - so that if the land owner decided to return land to the communities, there would be no tax to be paid. #LandReform

#19/22

Higher tiers of local government would then be funded by subvention from the community ouncils. This ends up being a huge amount of money - mainly Land Value Tax in urban areas, mainly Exponential Land Tax in remote rurals, but huge everywhere.

#20/22

It should pay for local government funding in its entirety, even if #SocialCare (which is where we started, remember?) remains a local government function. But it also means that @scotgov would no longer need to fund councils, so would have more money for, e.g., health. #21/22

In summary:
1. Local government tax reform is in the power of @scotgov;
2. It could radically redistribute wealth and land in Scotland;
3. It could greatly increase the amount of revenue for #SocialCare and public services;
4. while reducing tax on all but the wealthiest.

#22/22