Gold Coast light rail study helps put a figure on value capture's funding potential
Interesting to see here a study quantifying an increase in land values after the opening of the quite successful Gold Coast light rail. But this idea of financing transport (or other infrastructure) projects via extra taxes on adjacent land which receives its benefit just seems very fanciful, if you ask me. Ken Parish at Club Troppo wrote a couple of lengthy posts about it (in a positive light) with respect to a Sydney/Canberra/Melbourne high speed rail. Apparently, the idea goes, lots of people will be happy to move to the middle of the countryside, known to be hotter in summer and colder in winter than the coast, as long as they can hop on a high speed train and be in a big city within an hour. Just seems silly to me...
As to how to get money out of the increased value on properties if they are lucky to have a good rail system built near them, the article above suggests a simple way would be to levy land tax on them at a low rate, and removing the exemption on "owner occupied" real estate. That would be an ongoing impost. I wonder if an simpler way would be to levy an excess on stamp duty on purchases in the area. Or how about estate duties, no exemptions, but at a low rate hardly anyone would object to? Has anyone looked at the effect of no exemption 1% death tax on every single inheritance. (OK, lets say ones with a value over $100,000.)?
Anyway, the Gold Coast rail seems a bit of a blow to the pro-road infrastructure obsession of many small government types.