Planning gain supplement must benefit local communities

11.27.17am UTC (GMT +0000) Mon 5th Dec 2005

Responding to the announcement from Yvette Cooper that the introduction of a planning gain supplement is likely to be included in Monday's pre-Budget report, Liberal Democrat Shadow Chancellor, Vince Cable MP said:

"If a planning gain supplement is to be introduced it must be done at a local level. The Chancellor must not be allowed to simply use revenue from this tax to bolster Treasury coffers. The supplement must be set locally and collected locally to deliver improvements to local infrastructure.

"It is right in principle that the community should derive benefit where property developers see a large increase in the capital value of land, not as a result of their own efforts but due to the granting of planning permission.

"However the Treasury must be careful with how it frames the legislation the track record of similar schemes in the past is far from impressive. Legislation has previously had to be abandoned because it has been ill thought out.

"If the Chancellor gets the application wrong it could slowdown new house building and the development of much needed affordable housing. Consultation with the property industry on the structure of tax is vital to ensure compliance."