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49
tural property let upon different conditions altogether, and
extending over several counties in England and Scotland, or
Ireland, in which the incidence of local taxation differs to a
considerable extent.
10.—If ground rents are to be assessed to local rates some provision
must be made for the owner of the ground rents (as distinct
from mere occupation) to have a voice in the election of the
local bodies which spend the money he will be called upon
to pay.
11.—But will the rating of ground rents or "ground values" tend
to the ultimate benefit of the occupier 1 When the reversion
falls in and the freeholder lets his house to a yearly
tenant there will be no ground rent to rate, because the
tenant will pay one rent only, commonly called the rack
rent. If the land is to be rated separately from the house,
the freeholder is not likely to grant a tenancy for any
lengthened period, because the portion of rent representing
the hypothetical value of the land would be subject to a
deduction of a fluctuating amount. By keeping the property
in hand, or letting it on a short tenancy, the freeholder
would be able to raise or lower his tenant's rent as the
rates rise or fall. Bating the ground separately from the
building and making the owner of the ground liable for
rates in respect of the same without a possibility of contracting
himself out of the liability, would, therefore,
almost inevitably lead to the abolition of the leasehold
system and considerably diminish both fixity of rent and
security of tenure.
12.—It would, therefore appear, that the rating of ground rents or
"ground values" is not likely to be of any benefit except to
existing lessees and only then if existing contracts (including
covenants to pay all rates) are violated. Wholesale legalised
breach of contract is a serious step for a commercial community
to take, and would form a precedent capable of
indefinite application. In many, probably the majority, of
cases, these contracts have been entered into by the present
holders of leases with a full knowledge of the facts of the
case, e.g., by taking an assignment of a lease and paying a
D