I am grateful to have this opportunity to call on the Government urgently to investigate how a land value tax might be introduced to replace, first, business rates, and then council tax. I call for this because it would be more progressive and fair, it would help to prevent property speculation and it is a potential means of redistributing wealth. I am also encouraged by the fact that land value taxation has long been a key policy of one of the coalition Government partners. I hope that the robust reports on LVT from the likes of the Institute for Fiscal Studies, as well as debates such as this, might help to persuade the other partner.
As hon. Members know, LVT is a tax or levy on the value of land that takes account of any planning permission associated with it but not of any improvements made to the site such as buildings. For domestic property, for example, the house price includes both land and building values, but LVT would apply only to the land that the house stands on. LVT encourages efficient and sustainable use of land, as owners of derelict land or properties that they have deliberately allowed to become run down pay the same as those who take care of their properties. It therefore has the potential to bring more brownfield sites into use and to ease pressure on green belt. Building in towns and cities would become more efficient, urban sprawl could be reduced, and speculative land banking—for example, by big supermarkets—could be discouraged.