That’s what the Economist reported the impact would be in the USA. This works out at about – $1.5 trillion.

In Australia, Dr Ken Henry published a tax review back in 2010 proposing that stamp duty should be replaced with a broad-based land tax. This would help Australians deal with the rising cost of home ownership. Taxing land instead of property doesn’t discourage investment and gives an incentive to develop unused sites.It has been argued that land tax is one of the most effective and equitable methods of taxation available to any government. William Vickrey, the Canadian Nobel Prizewinning economist, argued that “The property tax is, economically speaking, a combination of one of the worst taxes – the part that is assessed on real estate improvements – and one of the best taxes – the tax on land or site value”.

In the UK particularly, cities need to provide accommodation for the “flat white economy”. But planning decisions are also subject to the slings and arrows of local decision making. The Economist argues that moving housing supply decisions to city level should mean that due weight is put on the benefits of growth.

In times of austerity and the need to stimulate growth, it’s perhaps time for a land tax city planning rethink…