Want growth? Scrap income tax and introduce a location tax

If we want to stimulate growth and tax people more fairly, we should replace income tax with a 'location value tax', says Merryn Somerset Webb. Here's how it would work.

A few weeks ago, I wrote about my lunch with a reader Nicholas Dennys - in London and repeated a story he told me about Martians and space dust, which was meant to exemplify the idea behind a land or location tax. I have been meaning to return to the subject so apologies for having left it so long. You can read the original posthere: Why a Martian would never manufacture in Britain,but I also want to run through some of the rest of our conversation for you.

The main point behind a land or location tax is that, in general, the price you pay for a property or piece of land (ie, the value the market gives it) is not about the land itself, but about where the land is. A house sitting on a piece of land might cost more or less the same to put up in Wales and London, and as a structure, be worth the same in both places.

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Merryn Somerset Webb

Merryn Somerset Webb started her career in Tokyo at public broadcaster NHK before becoming a Japanese equity broker at what was then Warburgs. She went on to work at SBC and UBS without moving from her desk in Kamiyacho (it was the age of mergers).

After five years in Japan she returned to work in the UK at Paribas. This soon became BNP Paribas. Again, no desk move was required. On leaving the City, Merryn helped The Week magazine with its City pages before becoming the launch editor of MoneyWeek in 2000 and taking on columns first in the Sunday Times and then in 2009 in the Financial Times

Twenty years on, MoneyWeek is the best-selling financial magazine in the UK. Merryn was its Editor in Chief until 2022. She is now a senior columnist at Bloomberg and host of the Merryn Talks Money podcast -  but still writes for Moneyweek monthly. 

Merryn is also is a non executive director of two investment trusts – BlackRock Throgmorton, and the Murray Income Investment Trust.