.

Sir: In your last issue, Professor Stephen Cord, in his article "Land Value Taxation: Six Steps to Meet Objections", by conceding too much to objectors, offers some very doubtful steps to meet them.

He says that under LVT, some small farmers would pay more taxes than they are now paying, as would "some poor elderly houseowners". But how can he know, unless he has already decided himself what the rate of tax is to be and what particular taxes would be removed as a consequence?

Small farmers under LVT paying low or no income tax, property tax or duties on their equipment etc., must find themselves better off. A small farmer is not defined; he may be a farmer working marginal land or land of very low value (in which case he would pay little or no tax) or he may own valuable horticultural land.

However, one does not need to know the conditions of small farmers and the elderly poor. If hardship arises, for whatever reason, (possibly a change in taxation or a natural calamity), welfare services should be available without recourse to corrupting the principle of LVT, which requires those who enjoy the rent of land either directly or indirectly to pay the appropriate charge.

Prof. Cord makes a good point when he argues that every attempt should be made to secure overall political acceptance for LVT; at first sight, the idea of a national dividend might appear attractive. However, to give back part of the land value tax as a cash handout would mean less provision for cutting other taxes. Surely the best way to secure general acceptance for LVT would be to argue for the removal of specific general taxes -those which the majority find most objectionable. Would this not be the equivalent to a cash bonus? Even the poorest people still pay taxes in one way or another. A cash bonus sounds gimmicky and too obviously a scheme to buy votes.

As for an Agricultural Land Tax Index, I fail to see why land value taxation should take account of bad and good years for farmers. When people go into farming, manufacturing umbrellas, or selling ice cream, they do so with open eyes and take the bad seasons with the good. The most governments should be prepared to do is to postpone part of the payment of a land value tax in a particularly bad year, recovering it in a subsequent year - and do it for umbrella manufacturers as well if they are suffering hardship!

However, if the valuation of agricultural land is done correctly, it will reflect the rent people will pay, whatever the vagaries of the weather. And what is to prevent the agricultural community from establishing a cooperative insurance scheme funded from the good years?

The weather, and world prices, are not the only things that affect returns to the entrepreneur. What of fashion, the invention of substitute materials, change of habits, mechanisation, etc.? This is all part of the free market. If concessions are made to sugar producers along the lines indicated, then the producers of every other kind would decide what ten per cent above normal price was, and what 20 per cent below normal production was? The scheme would be hopelessly bureaucratic as well as unnecessary.

By all means let the land value tax be paid by instalments if required, as indeed local taxes in the UK often are, and let an annual reassessment of land value be the rule. As Prof. Cord says, this would solve 'many problems and prevent a build-up of liabilities where land values increase, but it would also serve the farmer better than the other scheme.

The Tax Deferred idea of allowing a land value tax to remain a lien on the property until it is sold or transferred is an excellent one in cases of hardship, whether the owners be the elderly poor, widows, orphans or just plain impecunious.

Prof. Cord's Purchase and Demolition (PAD) Guarantee to protect property owners from marked changes in planning law which devalue the market value of their building sounds a good idea and a form of government compulsory purchase at previous market price for "blighted buildings" seems a necessary step. After all, the higher land values released should more than pay for the compensation.

I think Prof. Cord has opened up a useful and necessary debate, but it is a pity he did not give just a little more thought to some of his suggested remedies.