A Land Tax can raise substantial revenue, control land use and cut out tax evasion

Andy Anderson is well-known to the independence movement through his work on a Scottish currency. As a result of Andy’s efforts, a majority of Scots are now convinced we need our own sovereign currency upon independence.

In Andy’s letter, published in The National on December 20 2023, he supports Graeme McCormick's Land Tax policy. The current Scottish Government could, through introducing a land tax, raise substantial revenues, control land use and eliminate tax evasion, all within the current limited devolution settlement.

Now that all the usual suspects have made a great fuss about the small move by the Scottish Government towards a more progressive tax policy in Scotland, it is time for us to take a more rational and intelligent look at the appropriate fiscal policy for the Scottish Government to adopt in the move towards independence.

The often-repeated claim that higher taxes on the wealthy will create a “brain drain” and will lead to higher tax avoidance is what the media and the right wing have been repeating for years, without providing any evidence. There’s no doubt that tax avoidance is high and that this will continue, but this isn’t caused by high taxes, but by greed and poor regulation.

The Scottish Government is right to ignore this media hype and move towards more progressive taxation, not just because it’s fairer, but also because in a no-growth economy it will stimulate demand and help build economic growth. Of course, ignorant people like Douglas Ross, in order to please their wealthy masters, will hurl out-dated and empty slogans at them, but in the real economic world they will be moving in the right direction.

The Scottish Government needs a much bolder and progressive fiscal policy because the major changes in economic development require a more robust government response.

The idea that the economy is driven by small entrepreneurs who venture their own limited capital to develop new products and services to meet the needs and demands of the community has some historical basis in truth, but is not a true picture of our economic process today.

Jeff Bezos and Elon Musk both saw the paper value of their businesses rise from less than $10 million to around $200 billion between 2010 and 2021 (Yanis Varoufakis, Technofeudalism, p. 106). This wasn’t achieved in the traditional capitalist model, but in a different model, that of Rentier Capitalism, which doesn’t fit the ideas of Adam Smith.

These Neo-liberal Rentiers are now in control of large parts of the western world economy. They pay little tax and control markets. Governments today need fiscal policies which are designed to deal with the real economy in which these big international companies operate.

The way to respond to Rentier Capitalism’s power is for governments, not billionaires, to control the land and natural resources. The Scottish Government must put in place a comprehensive land tax system so that they can (a) control land use, (b) raise substantial revenue, and (c) cut out tax evasion.

If the Scottish Government moves in this direction it can avoid tax on earnings and reduce inequality. Best of all, such a system will cost the Scottish People very little and will fall mainly on the super-rich, a move that will no doubt please Douglas Ross and his wealthy masters.  

Andy Anderson