Re: Misc taxation Gesell & Johansen
- --- In LandCafe@yahoogroups.com, "k_r_johansen" <kjetil.r.johansen@...> wrote:
> So on the RPE (to RL): As far as I understand it it would be a declining exemption based on time before tax-shift the mortgage was taken up?No, on how long before LVT implementation the land was purchased. Unmortgaged purchases would also get the RPE, while new mortgages on long-held land would not because taking capital gains out via a new mortgage ("using the house as an ATM" in American parlance) does not involve paying any more for the land. Those mortgages would be stuck, as the proceeds have either been invested and are therefore still available to make the payments, or have been spent on consumption and therefore represent a debt legitimately owed.
> I discussed this with someone a while ago, and came up with a rough idea in similar terms: making the mortgage made pre-collapse a claim on the LVT itself, with a dollar for dollar credit from LVT on whatever interest and base payment made on the property until it's paid off.The RPE is not designed to rescue mortgage creditors but to prevent the injustice of double payment for land. To the extent that it does the former as a side effect of the latter, it will help ease the shock of LVT to the monetary, financial and banking systems.
> I'm sure there's a host of problems with it, off my head I immediately believe there will need to be an interest rate cap. Most likely the LVT would be smaller than the repayments in the start, and then LVT payments would go over repayments as assessments go up, this would mean that the tax-shift could not be done immediately for fiscal reasons.IMO this proposal is far too solicitous of the welfare of banksters.
> Maybe there could also be some kind of choice between a standard exemption (UIE or otherwise) and a mortgage exemption, whichever is higher, so the other guys without the mortgage would feel they were being treated nice as well.There's nothing stopping people from using their UIEs to offset pre-existing mortgage debt in any case. I would oppose any attempt to make LVT exemptions dependent on mortgage debt. People need to experience the fact that undertaking debt is undertaking debt, and buying land is buying land, and they are not the same thing at all, however much greedy banksters want to convince us that they are.
-- Roy Langston
- --- In LandCafe@yahoogroups.com, Scott Bergeson <scottb@...> wrote:
>Sorry for the late response. What do you mean by collateral then? Land/buildings can be handed over to the lender as well, can't it? Both loans secured on a physical object that can redeem the debt by reposession, and personal debts, should be entirely legal. I'm not sure if you mean that any specific institutional aspect of mortgage collateral should be abolished, or the idea, which is kind of the basis of risk-taking and economic growth IMO. If anything, the american model is better than what I know as mortgages. AFAIU you can hand over your property and "walk away". No such thing exists here. Even if you hand back the property, you are personally liable for the redemption of the debt, and a creditor sale of a property (moveable objects as well), can only be done through the courts.
> Quoting k_r_johansen on Thu, 25 Oct 2012 20:45:37 -0000:
> Interesting concept. In most cases, owners servicing mortgages would just
> use their UIEs as an offset to the LVT and continue making the payments.
> If we are talking about a straight swap from income tax to
> LVT, most people would theoretically still have the ability to
> pay. The problem is, and I admit I'm looking at this from the
> Bankster's side, that the collateral just isn't there any more
> (assuming capital values do fall, which I believe they will),
> and the change in risk has implications. Imagine that the country
> suddenly changed systems, and (by the figures I gave), a debt load
> of somewhere around 50% of GDP changed from being collateralized
> to more or less personal loans, but at an interest of 4%.
> Govt. would have to step in as a guarantee in either scheme.
> Abolish collateral. Even more than land privilege, that
> bankster concept keeps people enslaved. If it isn't
> outright security; i.e., something that can be handed over
> to the lender, thus entirely discharging the debt; the
> debt is unconscionable, and ought to be nullified outright.
> Obviously, this also requires concomitant abolition of
> Glass-Steagall (FDIC). Write down all deposits in any given
> institution proportionate to nullification of its assets.