A land value tax would be better than the business rates system, yes. Simply because we would be taxing what we want to be taxing, rather than a proxy for it. However, the two are pretty good proxies for each other. There are, as we’ve been explaining, problems with the factory tax but this isn’t anything more than entirely marginal when considering retail property.

One thing to note about either system is that the tax is, in the end, incident upon the landlords, not the retail tenants. That final burden just does not depend upon who writes the cheque. Thus these complaints about changing from business rates to land value tax don’t work:

Retailers have blamed the tax for the growing number of high street closures as they struggle to see off online competition. The present system is based on shop rental values and is calculated every five years. The levy is paid by tenants, rather than landowners.

Who pays doesn’t matter, who suffers does - landlords.

There are also concerns that a land value tax would be passed immediately from landlords to retail tenants through higher rents. Ed Cooke, chief executive of Revo, which represents hundreds of retailers, high street landlords and consultants, said that the proposal “misses the point entirely that rates and rent are related and therefore the incidence of the tax is shared between owner and occupier”.

No, it isn’t. The rates bill, an LVT bill, will fall on the shoulders of the landlord. That claim that rents will rise is proof of that. Currently the tenant “pays” rates and then rent to the landlord. So, we go with an LVT and it’s the landlord paying the tax. At which point rents rise to be the same as what the rent and the rates bill were before. That is the claim, isn’t it?

That is, to the tenant the rent and rates bill is exactly the same as the rent bill in an LVT system. Thus it must be the landlord paying the tax both times, a change in the tax bill doesn’t change occupation costs, only the amount the landlord receives.

Rates, as with LVT, are therefore incident upon the landlord.

Or, as we should put it, business rates aren’t paid by tenants therefore alleviating business rates won’t help retail. The savings will just flow to landlords. And why would we want to alter the tax system to aid landlords?