How do we stop land banking?

Gareth MorganEconomics, Property

The Productivity Commission has produced a draft report that looks at ways to increase the supply of land for housing. The report includes many good ideas, such as getting rid of minimum parking requirements, which we will talk about in future blogs.

One of the Productivity Commission’s ideas is to charge rates on public land in order to encourage the public sector to free up land for housing development. In our view there is a much more powerful solution to the problem of freeing up land for housing. Land banking is really a private sector problem, where people buy land and hold onto it waiting for the price to go up. We think taxing the unproductive use of capital – especially land – via a Comprehensive Capital Income Tax (CCIT) would solve this problem. This Whiteboard Friday looks at what a difference a CCIT would make to land banking.

You can find out more about the Productivity Commission’s report and make submissions on it here.

How do we stop land banking? was last modified: December 15th, 2015 by Gareth Morgan
About the Author

Gareth Morgan

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Gareth Morgan is a New Zealand economist and commentator on public policy who in previous lives has been in business as an economic consultant, funds manager, and professional company director. He is also a motorcycle adventurer and philanthropist. Gareth and his wife Joanne have a charitable foundation, the Morgan Foundation, which has three main stands of philanthropic endeavour – public interest research, conservation and social investment.