# People's Budget 1909 The **People’s Budget** was David Lloyd George’s 1909–10 fiscal program as Liberal Chancellor. It funded old-age pensions and naval spending with higher taxes on the rich — including a package of **land-value duties** inspired by [[Henry George]], at far lower rates than a [[Single tax]]. The House of Lords rejected the budget, forcing two 1910 elections and, eventually, the Parliament Act 1911. The land duties themselves were a fiscal flop and were repealed in 1920. ^overview Winston Churchill, then President of the Board of Trade, was Lloyd George’s ally. Conservatives called them the “Terrible Twins.” ## The land-value duties Enacted in the Finance (1909–10) Act 1910. Four instruments, all modest: | Duty | What it hit | Statutory rate | |---|---|---| | Increment value duty | Rise in *site* value after 30 April 1909, on sale, lease, death, or certain corporate holdings | 20% of the increment (£1 per £5) | | Reversion duty | Benefit to lessor when a lease ended | 10% | | Undeveloped land duty | Annual tax on the site value of undeveloped land | ½d in the pound (~0.2%/year) | | Mineral rights duty | Rental value of mining rights | 1s in the pound | Increment value duty required a national valuation of site value as of 30 April 1909 — the “datum line.” The Valuation Office and the 1910–15 maps/field books are the durable by-product. The duty was *not* an annual LVT on all land. It was a betterment / transfer tax on *future* unearned increment. Lloyd George: tax “the increment of value accruing to land from the enterprise of the community or the landowner’s neighbours,” not retrospectively. ^duties ## Why it is the standard cautionary tale Watling (*Works in Progress*, 2025) and the official repeal record converge: - Definition of site value generated endless litigation. - Administration cost swamped yield. Austen Chamberlain in 1920: the duties “in their present form are unworkable” and “have produced hardly any revenue.” No undeveloped-land duty assessed after 1914 even though it was annual. - In practice the tax often hit builders’ profits rather than idle landlords, and housing production suffered. - Finance Act 1920 s. 57 repealed increment value duty, reversion duty, and undeveloped land duty, and ended the statutory national valuation. This was **not** George’s single tax. Rates were tiny; other taxes remained; valuation was of increment on events, not a yearly tax on current site value. It is still the largest British attempt to write Georgist ideas into the code, and it failed on administration before it could fail on theory. ^failure ## Political residue The *budget fight* succeeded in a different way: it broke the Lords’ veto. The *land tax* did not become the British fiscal base. Later UK talk of LVT (including Andy Burnham’s interest in replacing stamp duty) still has to answer 1909–1920: can you value the site separately, cheaply, and defensibly? --- ## Citations 1. [People's Budget — Wikipedia](https://en.wikipedia.org/wiki/People%27s_Budget). Dates, Lords conflict, Parliament Act 1911, George/Churchill. 2. [Increment Value Duty — Wikipedia](https://en.wikipedia.org/wiki/Increment_Value_Duty). Datum line 30 April 1909; Valuation Office maps; repeal by Finance Act 1920. 3. Hansard, [Clause 1 — Duty on Increment Value, 13 July 1909](https://api.parliament.uk/historic-hansard/commons/1909/jul/13/clause-1-duty-on-increment-value). 20% rate text. 4. Lloyd George budget speech material in *Life of David Lloyd George* (archive.org). “Increment of value accruing to land from the enterprise of the community”; 20% of future increment; first-year yield estimate £50,000. 5. [The People's Budget 1909/10 — progress.org wiki](https://www.progress.org/wiki/peoples-budget-1909/). Statutory rates table; Chamberlain 1920 quotations; Murray on modest rates. 6. Samuel Watling, [“The failure of the land value tax”](https://worksinprogress.co/issue/the-failure-of-the-land-value-tax/), *Works in Progress*, 2025. Administration cost, builders hit, 1922 political aftermath. 7. Related: [[Land value tax]], [[Single tax]].