Debate Magazine

First Rule of Land Value Tax Club...

Posted on the 08 February 2015 by Markwadsworth @Mark_Wadsworth

... don't talk about Land Value Tax unless you know about land values.
The LVT campaign linked to an article in The Guardian about Business Rates. By far and away, the single largest BR bill is on Heathrow airport, if you add together the airport, the maintenance area and Terminal 5 (ignore cargo terminal), it's £150 million a year. The next biggest is Sellafield, at £32 million.
(The LVTC article appeared to suggest that Heathrow was overtaxed. Sellafield might or might not be; in terms of 'alternative use of the land they are occupying', they are wildly overtaxed, but what they are paying for is 'the right to run a nuclear power station' which as we know is worth ££billions. Even if the right is only worth £1 billion, then £32 million a year BR looks about right)
Returning to Heathrow, their BR bill is tuppence ha'penny, frankly.
What Heathrow airport is paying for is not so much the site itself (all 3,000 acres of it!) but the privilege of using London's airspace and quick transport links into London.
Acording to Heathrow's website, there are about 480,000 aircraft movements a year (one landing plus one take-off).
Check: one every forty seconds, 14.5 hours a day, 363 days a year = 473,000. Looks about right. There are different figures for the number of passengers, so let's take the mid-point 65 million.
Divide our BR bill of £150 million by 480,000 movements = £ 313 per aeroplane landing and taking off, or about £2 per passenger. Seems pretty good value to me.
There's far more to it than just BR of course.
The biggie is actually Air Passenger Duty. Let's assume that Heathrow airport generates half of all APD in the UK (it might be two-thirds, who knows?), that's £1,600 million a year. Ten times as much as their BR bill.
Heathrow is running at capacity, so whatever taxes they pay, they are clearly not so high as to depress demand/output.
APD is a tax on transactions (the worst kind of tax); a flat per 'plane tax would be far better; but best of all is to scrap APD and hike Heathrow's BR bill to £1,750 million all-in. That's £3,300 per aircraft movement or £25 per passenger (return trip).
Relieved of the faffy and inefficient APD, airlines will be able to increase ticket prices accordingy, and the regulator would then allow Heathrow to increase its landing charges from £20 to £45 per passenger.
(Clearly, it makes more sense for Heathrow to charge per aircraft movement than per passenger. All things being equal they want fewer aircraft movements (expensive and risky) and more passengers (very lucrative, they spend money at the airport), but there you go.)

You Might Also Like :

Back to Featured Articles on Logo Paperblog

These articles might interest you :

  • My Umbrella and I


    I bet each one of you has an umbrella story (or several) to tell. My first memory of an umbrella is probably from the time I was five-or younger-huddling under ... Read more

    The 17 July 2018 by   Vidyasury
  • Downward Causation

    Downward Causation

    I've argued for the idea that social phenomena are generated by the actions, thoughts, and mental frameworks of myriad actors (link). This expresses the idea... Read more

    The 17 July 2018 by   Dlittle30
  • Ikk Panjab Rajouri Garden Food and Restaurant Review #FoodReview

    Ikk Panjab is a synonym of the blissful dining experience. Nothing falls short of expectation here. A place to rediscover lost recipes. There are many factors t... Read more

    The 17 July 2018 by   Jaideep Khanduja
  • A Food-Lover’s Guide to Greece

    Food-Lover’s Guide Greece

    Ah, Greek food! Just the thought of a warm filo pastry with a mizithra cheese stuffing and a cup of dark Greek coffee brings back near-perfectly preserved... Read more

    The 17 July 2018 by   Niviya Vas
  • 2018 Monsoon Must Haves

    The monsoons have arrived and along with its relief, have come a few of monsoon’s undesired experiences. We tend to not put on our best clothes during the... Read more

    The 17 July 2018 by   Meet Rv
  • SAAM Arcade: Game Spaces

    What does "Game Spaces" mean to me? When we began discussing our plans for this year's Independent Developer Showcase, we knew that we wanted to focus on... Read more

    The 17 July 2018 by   Americanart
  • “There Was No Significant Association Between Saturated Fat and Cardiovascular...

    Does eating saturated fat increase the risk of heart disease? Or is something else the culprit? And which risk markers should we look at when investigating whic... Read more

    The 17 July 2018 by   Dietdoctor

Paperblog Hot Topics