There’s a report that the Government is going to start taxing your view, raising your council tax band or two for an extra bedroom, a conservatory, lower it if you’re beside a power line and so on.

Taxpayers are set to be charged hundreds of pounds
extra a year if they are in a conservation area, next to an open space,
have a swimming pool or tennis court or enjoy full or partial views of
the sea, hills, mountains, lakes or rivers.

Extra
charges are also expected to be levied on homes with more bedrooms than
average, conservatories, large patios or gardens, roof terraces or
balconies. Homes in "gated communities" will also face higher bills.

Official
documents show that ministers are going to extraordinary lengths to
build a detailed database of properties across England, with the
intention of placing them in a higher council tax band.

In one sense I can’t really see the problem with this. Council tax is levies on the value of a house. Getting a better valuation makes some sort of sense really, as the banding process itself is pretty "suck a thumb and see". It’s entirely normal, in the US for example, for property valuations to be made in such detail.

On the other hand it could turn out to be yet another bureaucratic nightmare. Why not, for example, just ask the estate agents in an area what a place is worth? They’ve usually got a pretty good idea.

However, it’s the other bit that shows what a mess such taxation is in:

The charges will come in after a long-awaited
revaluation of each property in England and will take into account the
huge rises in property values since the last valuation in 1991.

Earlier
this year, ministers postponed the revaluation, which was originally
set for 2007, fearing a backlash from middle-income voters in the
South, who are expected to face the highest rises.

If local taxation actually paid for local services (as it should, arguably,) then the revaluation shouldn’t actually be such a political hot potato. It might be that four bedroomed houses had changed value relative to two bedroom flats inside an authority, say (with the change in demographics this doesn’t seem unlikely) and so the tax load would be rebalanced. But the amount raised in taxes in any specific authority would remain the same. For local services do not cost more or less (well, only to the extent that councils use rented rather than owned property to provide them from, a marginal difference at best,) depending upon the underlying property values.

What causes the political problem is that local taxation does not pay for local services.  There is huge cross-subsidy between local authority areas so the change in relative values between the North and South (say) leads to a huge group of losers and another of winners. Unfortunately, from the Tory heartlands to the Labour heartlands.

One way out of the mess would be as follows. Tax the undeveloped value of the land, not the developed (nice bit  of Georgism there, taxing the Ricardian Rent at 100% for example), as that is the value being provided to the property owner by the surrounding society. Abolish the system of cross subsidies which would also mean abolishing the central subsidies to the councils. This would be achieved by taking huge chunks of spending out of Local Authority control (like an education voucher system for example) and funding them direct from the centre rather than the current system of grants from the centre going to the Local Authority to pay for them.

This would also lead to greater local democracy….you vote for people and they have to raise the taxes from you to pay for what you want. Democratic accountability even.

It won’t happen, of course, far too sensible an idea.