Pt.2 - The King can pay his own way

0.025%. That’s the share of the Scottish population who own two thirds of all private land. Put another way, it's a few hundred people in a country of five and a half million. It's been that way for centuries, and our tax system is key to how elites have maintained this feudal pattern of land ownership into the 21st century. 

This month we can tilt the scales back towards ordinary people - and here’s how:

To launch this newsletter I started to set out how we tax the rich to tackle a housing crisis they played a big part in causing. I’ve had to lodge so many proposals to fix a system so comprehensively rigged in favour of elites that I couldn’t fit it all into one or even two posts though.

With MSPs starting to vote tomorrow morning (Tues 6th May), here’s part two of three, covering everything I’m putting forward to end the stranglehold of aristocrats, billionaires and international elites:

Tackle overseas ownership

That 0.025% elite includes plenty of the old aristocracy whose families have controlled vast swathes of the country since the Highland Clearances or even long before that. The largest single landowner in the country though is Danish billionaire Anders Povlsen, a stark illustration of the problems caused by Scotland becoming a playground for international elites.

Indeed, the UK as a whole has become the world’s top destination for overseas ‘investment’ in real estate.

Right now an overseas buyer pays the same rate of tax as someone who actually lives here, even the ones buying up property in Scotland from the comfort of Caribbean tax havens. I’ve tabled proposals to create a surcharge for overseas buyers, making it more expensive and more off-putting for those who don’t actually live here. This wouldn’t apply to anyone immigrating here and needing a house to live in, just to those buying second homes or ‘investment properties’.

And for good measure, I’m aiming to create a new, higher rate of Council Tax for overseas owners of holiday/empty properties. If they want the pleasure of owning a property in Scotland for whatever purpose, then they should pay through the nose to make up for keeping that home out of the hands of someone who would actually live in it.

Personally I would ban overseas ownership entirely, especially for those based in tax havens. That’s not my remit on this bill, but hopefully we can return to it when MSPs turn to the Land Reform Bill in a few weeks.

Make the King and Trump pay their fair share

Two very simple amendments I’m putting forward (one at this stage and the other slightly later) would end the most indefensible tax exemptions on the statute books - the 100% relief from Land and Buildings Transaction Tax currently enjoyed by the King and foreign militaries.

The King is one of the richest men in the country and one of the biggest landowners. He can more than afford to pay the same tax as everyone else.

And given the only foreign military with any significant presence in post-war Scotland is the United States, we should be urgently ending anything which might act as an incentive for Trump to increase his footprint here. We cannot go back to our Cold War role as the American military’s launchpad on this side of the Atlantic.

The Mansion Tax

And finally for today, a simple one - a new higher rate of tax for those buying properties worth at least a million pounds. Anyone fortunate enough to purchase the Newliston Estate just outside of Edinburgh (offers over £3 million, if you’re tempted) should pay a higher rate than those buying an £800,000 townhouse in the New Town. That money could go straight into building the social and genuinely affordable housing we urgently need.

We’re now about two thirds of the way through my package of tax reforms to tackle the housing crisis. It’s lengthy because the system is so thoroughly rigged in favour of the rich. It needs to be overhauled from top to bottom, which is exactly what I’m trying to do.

In part three I’ll cover the solutions to holiday homes and short term lets driving rural and island communities to collapse and how we make big housing developers pay towards the public infrastructure their estates need to be functioning communities.

Preview image used under Open Government License 3, UK Government