1. Property Taxation – Time for Reform? Jeremy Edge Edge Planning & Development PLRG 2011 Programme LSBU Thursday 3rd February

2. Background RICS Research Project – Property Taxation Purpose - Engage with Treasury to introduce simplification Lack of knowledge regarding the magnitude of tax raised through property Lack of understanding of the effects of reliefs and exeptions

3. The Property Cycle – A Taxation Opportunity

4. Property Life Cycle

5. Commercial Property Taxation Opportunities

6. Residential Property – Life Cycle

7. Residential Property Taxation

8. Council Tax Occupational tax – regardless of ownership A variety of exemptions exist, such as those detailed below: The property is empty Only one adult lives there The occupier is disabled The occupier is a student Low income families can also qualify for council tax benefit

9. Council Tax Bands BandValueRatioRatio as %Average Aup to £40,0006/967%£845 B£40,001 to £52,0007/978%£986 C£52,001 to £68,0008/989%£1,127 D£68,001 to £88,0009/9100%£1,268 E£88,001 to £120,00011/9122%£1,550 F£120,001 to £160,00013/9144%£1,832 G£160,001 to £320,00015/9167%£2,113 H£320,001 and above18/9200%£2,536

10. Council Tax – Geographic Value Distortion

11. Stamp Duty Land Tax RESIDENTIAL Value up to:Rate £125,0000% £250,0001% £500,0003% Top rate (£500,000 +)4% NON-RESIDENTIAL Value up to:annual rentRate £150,000< £1,0000% £150,000£1,000 +1% £250,000n/a1% £500,000n/a3% Top rate (£500,000 +)n/a4% Notes (1) First time buyers exempt from SDLT up to £250,000 (2) For disadvantaged areas lowest threshold is £150,000 (3) SDLT also payable on some new leases, dependent upon rents

12. Stamp Duty Thresholds

13. Developer Contributions Nationalisation of Development Value Betterment Levy Development Land Tax S106 agreements – need for transparency Tariffs Planning Gain Supplement Community Infrastructure Levy – Planning Act 2008 CIL Regulations April 2010 Charging Schedules Scaled back s106 arrangements

14. Viability Assessment S106 contributions - subject to viability testing Affordable Housing provision Cross Rail Levy and hypothecation Modelling to assess the planning gain tax

15. Conclusions Property taxation needs an overhaul Equity and efficiency issues need to be addressed Vested interests are likely to resist change and seek new exemptions and reliefs Do we need to try other approaches?