Insurance News Archive
Government's proposed land levy under fire
New developments are unlikely to receive the funding needed under the government's new proposed land tax, the Planning-gain Supplement (PGS), a new report revealed this week.
The report also stated the suggested land levy may raise less money for local authorities than under current arrangements, causing small building firms to be put out of business.
Brian Berry, head of policy at the Royal Institution of Chartered Surveyors (Rics), expressed his concern about the findings.
"This is a prime example of the government shooting itself in the foot," he said.
"The research clearly demonstrates that PGS fails to achieve the government's stated objective to raise additional money for infrastructure. The mechanics are flawed and need to be reworked."
The planned changes are likely to impact upon commercial property owners, in terms of the value of their land.
Under the current system the study showed that a sample of 18 developments would have produced £375 million in tax which is considerably greater than under the proposed PGS producing just £279 million.
The research was conducted by property consultancy Knight Frank, which analysed 18 case studies on behalf of the British Property Federation, Rics, the Confederation of British Industry and the Home Builders Federation.
20 Sep 2006