Land reform in a Net Zero nation: consultation analysis

Outlines the findings from an analysis of responses to a public consultation on land reform in a Net Zero nation.

10. Other land related reforms

The consultation paper notes that the Scottish Government wishes to use the consultation as an opportunity to seek views on other measures that may be considered for inclusion in the Land Reform Bill, or that could be taken forward in other legislation.

Fiscal and taxation

The SLC has recently considered the potential for taxation to contribute to land reform, and the consultation seeks views on the role that taxation might play in this regard.

Question 42 – Do you have any views on what the future role of taxation could be to support land reform?

Around 305 respondents answered Question 42.

The role of taxation to support land reform

A number of respondents referred to taxation as a potentially significant lever to support wider land reform objectives, with some expressing disappointment that the consultation paper did not include specific proposals for taxation of land. Several respondents suggested that large-scale landholders benefit from a range of grants, subsidies and tax exemptions, which some saw as having contributed to substantial increases in land values. It was also suggested that current taxation of land does not do enough to encourage good land management and support communities.

In terms of the potential role of taxation, there was specific support for the recommendations of the SLC to enhance the role of land in taxation, to tackle inequalities in the system and support productivity. There were also comments in favour of the role of taxation in supporting the investment required to achieve a just transition to net zero, reflecting concern around potential for this investment to exacerbate inequality without a progressive taxation approach.

Some respondents wished to see taxation reform include a specific focus on supporting public and community benefits, for example by encouraging sustainable land management and supporting a just transition, while stimulating productivity. Other specific issues where respondents wished to see consideration of the potential role of tax reform included: tackling excessive land value increases; absentee landlords; addressing concentration of land ownership; and limiting the size of large-scale landholdings. Some also wished to see a stronger role for communities in reform of taxation to support land reform objectives.

Issues and concerns around use of taxation to support land reform

Some respondents – including Landowners, Private sector organisation and Representative body respondents – raised concerns about potential for taxation changes to have unintended negative consequences. These respondents saw potential for significant long-term impacts on land ownership and land values, reduction in investment in rural economies, limiting progress towards net zero, and discouraging agricultural lettings and new entrants to the farming market. Some highlighted these concerns specifically in relation to potential use of taxation to reduce large-scale landholdings and diversify land ownership. This included reference to the potential benefits of larger landholdings in terms of delivery of climate and environment policy targets.

Specific concerns around potential for tax reform to affect delivery of climate targets were linked to calls for Scottish Government to ensure that any changes to taxation should not disadvantage land managers in Scotland. The roles of land management in delivery of net zero targets, ensuring food security and supporting rural economies were highlighted.

Limits on Scottish Government powers in relation to taxation were also highlighted and the extent to which the devolved settlement provides sufficient powers to make the taxation changes required to have a significant impact on land reform objectives was questioned.

Proposals for use of taxation to support land reform

Reflecting the mix of views noted above, responses included a range of specific proposals for taxation reform to support land reform. This included some who noted that taxation in relation to land in Scotland is a complex issue, with multiple tax mechanisms applying to income derived from land. There were calls for use of taxation to form part of a co-ordinated approach to land reform, alongside subsidies and regulation. Concern that any changes to taxation should be considered holistically included specific calls for full impact assessment of any proposed changes to taxation.

General points included that all landholdings should be brought onto the valuation roll and that the Scottish Government should build on the work of Registers of Scotland to integrate information on land ownership, use and value, using a cadastral approach.

Forms of taxation that could be used

Types of taxation respondents thought could be used to support land reform included:

Inheritance and capital gains tax: It was suggested that dispensation from inheritance and capital gains taxes are drivers of land values, and that taxation on transfers of assets such as capital gains tax and inheritance tax could make a significant contribution to land reform objectives. There was a specific suggestion that exemptions on inheritance tax for land should be removed. It was noted that inheritance and capital gains tax are not devolved matters, but it was argued that there is a strong case for their devolution to support devolved land and environment policy.

An alternative perspective was that changes to inheritance tax could have potential to break-up viable rural businesses and reduce investment in rural property.

Land and Buildings Transactions Tax (LBTT): It was suggested LBTT could be used to reflect high land values, with some noting that this would be within the powers provided under the devolved settlement. Specific proposals included a sliding scale supplement on land sales meeting specific criteria (the supplement to be directed to the Scottish Land Fund), and alignment of non-residential rates of LBTT with those for residential properties (with additional bands for higher values).

However, it was also noted that SLC considered that a surcharge on LBTT would be unlikely to significantly change patterns of land ownership, and there was a call for LBTT to be revoked to incentivise land transactions.

Land value tax: A progressive tax linked to the value and/or scale of landholdings was suggested by respondents across a range of respondent types including Community, Private sector organisation, Representative body, Third sector and Individual respondents. It was suggested that such a tax could incentivise the land sales required for land reform proposals to be effective. There were also calls for a land tax to be collected by local authorities to support local democracy, and for a land tax to replace income tax.

Concerns around a land value tax included suggestions that such taxes have been unpopular in other jurisdictions and did not replace other taxes.

Reformed local taxes: It was noted that reform of local taxes to include a land-based element would be within the devolved powers currently available to the Scottish Government. Phased re-introduction of non-domestic rates in relation to agriculture and forestry land was proposed to ensure equality with other rural businesses and to encourage better land management. This included proposals to split non-domestic valuations between land and improvements.

Other suggestions for local taxes included providing local capital gains tax powers, transferring LBTT to local authorities, and enabling local authorities to levy carbon and externalities taxes on land use.

Activities that could be subject to taxation

Some respondents highlighted particular activities or sources of revenue that they would like to see subject to taxation. These included:

  • Taxation of landholders making profit from natural capital projects in Scotland, including suggestions that tax benefits should be re-directed to the area in which the landholding sits. It was also suggested that tax breaks or incentives should be linked to the value of natural capital generated and/or ecosystem services provided.
  • Taxation of profits from carbon credits and/or mechanisms to re-distribute a proportion of these profits to local communities, including via community wealth building funds.
  • Taxation linked to carbon emissions, potentially administered by local authorities. Specific suggestions included a Carbon Emissions Land Tax to accelerate land-use change amongst traditional landowners, on the basis of a ‘polluter pays’ principle.

It was also suggested that there should be consideration of issues around:

  • Forestry grant schemes and VAT, in light of the relatively large proportion of small landowners and crofters who are not registered for VAT.
  • Landowners’ use of Charitable Trusts for tax purposes, with a concern that these can be used to avoid scrutiny and transparency.

Using taxation to support specific purposes

In order to incentivise improvements in housing stock and housing land availability it was suggested there should be non-domestic tax relief on formerly derelict properties or houses on formerly derelict sites. A modernised form of Business Premises Renovation Allowances was also suggested as a means to incentivise private investment in vacant premises.

There were also suggestions with respect to groups that could be supported by the taxation system including:

  • Support for community wealth building by reforming taxation and subsidies around community purchase to provide additional support for communities acquiring land.
  • Support for new entrants to the agricultural sector. Use of income tax relief for this purpose in the Republic of Ireland was highlighted and there was reference to stamp duty exemption for acquisition of land by young, trained farmers as a potential approach. However, there was also a view that agricultural holdings legislation is more relevant than taxation with respect to the fall in tenanted farmland in Scotland.
  • Support for Scotland-based artists through tax incentives.

Community benefits and natural capital

The consultation paper notes that private investment in natural capital will be essential to support delivery of climate change targets, and wider land use and environmental policy objectives. A set of Interim Principles for Responsible Investment in Natural Capital have been produced to ensure this investment in responsible, and the consultation seeks views on how the Scottish Government could maximise community benefits from investment in natural capital.

Question 43 – How do you think the Scottish Government could use investment from natural capital to maximise:

a) community benefit

b) national benefit

Around 280 respondents answered Question 43.

The potential role of investment from natural capital in maximising community benefit

Some respondents who commented on maximising community benefit welcomed the commitment to use natural capital investment to maximise community interests. This reflected a view that community benefit should be a central consideration for all investment in natural capital, recognising that this will support stronger communities and local economies. In this context there was support for use of the Interim Principles for Responsible Investment produced by the Scottish Government.

While some respondents did not see a direct link between new land reform legislation and delivery of community benefits, there was a view that much can be achieved in terms of delivering community benefits without legislation. This included reference to the role of policy interventions and regulation, use of public funding, and sharing of good practice. There was also reference to ongoing work, building on LRRS principles, to identify how community benefits can best be derived from natural capital investment.

Other respondents – including some Landowners – raised concerns around the role of investment from natural capital in supporting community benefits. Further clarity was sought on the interpretation of ‘natural capital’, and a clearer definition of the kinds of community benefit that may be expected. There was also a view that the Interim Principles for Responsible Investment are relatively narrowly focused on carbon management, and a broader interpretation was recommended in order to encompass flora, fauna and natural scenic beauty, and to recognise potential to support land-based industries and activities. It was suggested that ‘natural capital’ is not yet a particularly meaningful term for communities, and that work may be required to identify how the priorities of communities can be supported by investment in natural capital.

The most significant concerns around the role of natural capital investment in delivery of community benefits were linked to a view that the consultation does not give sufficient recognition to the expenditure and future liabilities required to develop new income streams around natural capital. This included comments highlighting the extended timescales required to realise benefits from natural capital investments such as peatland restoration and forestry planting. There was also scepticism around the potential role of carbon markets, and a view that potential for natural capital investment to support carbon sequestration or emissions reduction has been exaggerated. In this context, it was suggested that it would be premature to burden ‘fledgling markets’ with additional taxation, and there was concern that this could undermine the viability of natural capital investment, and slow delivery of net zero targets. It was also suggested that there is no justification for taxing net zero initiatives, but not income from other investment. A wider view was also expressed that allowing land managers to run their estates effectively will generate community benefits, for example through job creation, supporting rural economies, environmental improvements, and generation of tax receipts that can be directed by the Scottish Government.

It was also noted that proposals to strengthen requirements around the LRRS and Land Management Plans are likely to have a significant impact on the natural capital market, and that the impact of these proposals should be assessed before further action is taken.

Potential community benefits associated with natural capital

As noted above, the Scottish Government was asked to provide clarification around the kind of community benefits they expect to be supported by investment in natural capital. Respondents also discussed a range of specific community benefits that could be supported by natural capital, and which they wished to be a particular focus. These included:

  • Improving the sustainability and resilience of smaller communities. There was reference to greater use of natural resources and the products of natural resources to support local economies and deliver community benefits, including the role of natural capital in relation to food and drink, tourism, leisure activities and outdoor sports.
  • Building the resilience of local economies, for example through use of natural capital investment to support skills development and local job creation.
  • Supporting community wealth building.
  • Improving mental and physical health and wellbeing.
  • Improving the quality of and access to the environment.

The overall approach to delivery of community benefits

In addition to specific suggestions for how natural capital investment could support community benefits, respondents also highlighted a range of considerations in relation to the overall approach to natural capital investment.

Some saw a need for an improved understanding of embodied carbon within landholdings, and potential for nature-based solutions to deliver community benefits. This included specific calls for work to improve public understanding of natural capital.

Respondents also highlighted the need for a meaningful role for communities in planning investment in natural capital, and how this can support community benefits. This was linked to a view that communities are best placed to identify potential benefits. It was also suggested that further work is required to identify existing tools and initiatives that could help to connect community priorities with investment in natural capital. This included reference to ongoing research and evaluation around potential tools and approaches, including by RLUPs and by the NatureScot People and Places team.

There were specific calls for more use of community action planning, targeting of community development support to help disadvantaged communities have more influence on decisions about natural assets, and use of participatory budgeting to inform investment in natural capital (building on Scotland’s Green PB initiative). Some saw a need for brokers or intermediaries and suggested that local authorities could take on this role, noting their links to communities of place, services such as planning and economic development and experience of linking local initiatives and priorities with national policy objectives.

Specific proposals for use of investment from natural capital to support community benefits

Respondents set out a wide range of specific suggestions for how investment from natural capital could help to deliver community benefits. These are summarised below.

Alternative models of land ownership

Respondents from across a range of respondent types expressed support for a focus on alternative models of land ownership in securing community benefits. This included specific reference to community ownership, collective private ownership and community-owned partnerships. It was suggested that support for these models of land ownership should include a focus on supporting community-based initiatives using natural capital to enhance sustainability, and address the climate and biodiversity crises. In addition to calls for funding to facilitate community buyouts, there were calls for additional funding for intermediaries to enable communities to engage in these ownership models, for example via RLUPs.

It was also suggested that public landowners should be encouraged to take a leadership role in use of land to maximise community benefits. This included proposals for development of more shared governance models to give communities a stronger role in ownership, control and decision making in relation to land. It was suggested that some of the barriers to communities accessing the land market could be addressed by public landowners acquiring landholdings with the intention of transferring some or all of the land to community ownership and/or management.

Use of levies and taxation

Several respondents suggested use of levies on renewable and natural capital schemes and carbon offsetting receipts to deliver community benefits, and support wider climate and nature restoration priorities. This included specific proposals for a Community Wealth Fund to support community acquisition of land and other revenue-generating assets, and for use of revenues from natural capital taxation to support crofting and farming tenants. Wealth fund models (such as those used in Norway) and funds linked to wind farm development were suggested as potential approaches, although it was suggested that the timescales involved in natural capital schemes are significantly longer than for wind farms.

Some respondents wished to see the Scottish Government assess potential for local community benefit and/or natural capital funds to ensure benefits from natural capital investment are shared fairly between public, private and community interests. This included a suggestion that these funds could be co-ordinated across the UK to avoid distortion effects. As noted earlier, there were concerns around potential taxation of natural capital investment, but there was also a view that it should be possible to design funds that do not deter investment.

Regulation and standards

Proposals for use of regulation and standards to encourage a stronger focus on delivery of community benefits reflected support for the Interim Principles for Responsible Investment produced by the Scottish Government. Specific suggestions included updating the LRRS to set out criteria that landowners should apply to nature-based investment to realise community benefits, and support for the SLC’s protocol on Responsible Natural Capital and Carbon Management.

There were also specific calls for regulation of carbon markets to incorporate a focus on delivery of community benefits. This included calls for third party accreditation to ensure that only genuinely unavoidable emissions are offset, and reference to SLC recommendations for a Carbon Commissioner with powers to impose financial penalties for breaches of codes of practice. Improvements to carbon codes were also suggested in order to better address biodiversity and community benefits, including a proposed ‘gold standard’ accreditation scheme linked to public funding.

Guidance and training were also recommended to support better decision making for communities and improved understanding of potential for natural capital to support community benefit. Specific suggestions included training and guidelines for land managers to support community engagement (with reference to SLC guidelines for community engagement as a potential model).

Other proposals

Other proposals with respect to supporting community benefits included:

  • Use of Compulsory Sales Orders as proposed by the SLC, including new measures to improve land assembly. There was also support for measures to create a housing land bank controlled in the public interest.
  • Legislative reform to enable Scotland’s Common Good land to be used in a more dynamic way to underpin community wealth building, including reference to specific proposals identified by the SLC.
  • Re-orienting of public funding to establish nature-based economies, including calls for improvement of green grant schemes to ensure they incentivise best practice in terms of delivery of community benefits.
  • Encouraging private investment focused on business models that deliver nature recovery alongside community benefits, including a view that Scottish Government needs to go further in providing leadership around development of private investment. Specific proposals included locally-driven public investment vehicles to support small and medium sized nature-based enterprises, and empowerment of local ‘anchor institutions’ to attract inward investment and ensure this benefits local economies.
  • Requiring all natural capital projects to provide a clear demonstration of how they will create community benefits. It was suggested that Land Management Plans could demonstrate how natural capital investment with external financial support will deliver community benefits, and there were calls for use of community benefit clauses in any procurement contracts investing in natural capital.
  • Use of development frameworks to ensure delivery of community benefits in locations where there are opportunities for private investment in natural capital.
  • Supporting community benefits through investment in natural capital in urban areas, for example to support town centre regeneration, address issues around vacant and derelict sites, and take a more public interest-led approach to housing land supply.

The potential role of investment from natural capital in maximising national benefit

Some respondents expressed support for the role of investment from natural capital in delivering national benefit. This included respondents highlighting the national benefits inherent in any investment in natural capital, to the extent that natural capital will contribute to a just transition to net zero, and nature restoration. There was also reference to the Interim Principles for Responsible Investment in Natural Capital as having a potentially significant role in shaping investment in natural capital.

In terms of how national benefits might be delivered, many of those who commented referred back to issues around potential for natural capital to support community benefits. Some specifically highlighted that community and national benefits should not be mutually exclusive, and there was a view that community benefits can accrue to national benefits.

Some respondents argued that the current pattern of land ownership has been effective in maximising delivery of national benefits by Scotland’s land and natural capital. These respondents cited evidence around the proportion of Scotland’s natural capital stocks held by estates, and the contribution made to national outcomes by estates’ investment in natural capital. The role of this structure in delivering national benefit through tree planting, flood risk reduction, biodiversity and wildlife enhancement, and improved air and water quality was highlighted and it was suggested that estates and large-scale landholders should have a significant ongoing role in supporting the transition to net zero.

In this context, concern was expressed that pursuing more fragmented land ownership could reduce opportunities for natural capital investment at the scale required to deliver national benefits. Specific reference was made to the proposed public interest test for large-scale land transactions as threatening the continuity of important natural capital projects, with the long periods required for returns on peatland restoration and management highlighted.

Other concerns raised around potential for investment from natural capital to support national benefit included a view that care will be required to ensure that any changes to sharing financial benefits from natural capital do not undermine investment to enhance biodiversity and support net zero targets. It was suggested that any proposed changes to the current pattern of land ownership must be based on sound evidence that changes will provide greater benefit.

There was also a perceived need to ensure that investment from natural capital is not dominated by carbon offsetting. There was concern that doing so could allow previous mistakes (such as planting of large-scale blocks of Sitka spruce) to be repeated, driven by the prospect of short-term gains. Clarity was also sought around taxation of carbon credits, and whether these are to be treated as assets or trading income. It was suggested that this could have a significant impact on potential for national benefits.

Potential national benefits associated with natural capital

Specific national benefits that could be supported by investment in natural capital, were seen primarily as being related to the just transition to net zero. It was suggested that delivery of net zero targets will require ‘extraordinary’ levels of investment, and that much of this is expected to be from private sources. It was argued that there should be careful consideration to ensure that this investment reduces inequality.

Discussion of potential for natural capital investment to support a just transition included specific reference to climate mitigation and adaptation, nature restoration and biodiversity enhancement. This included some who wished to see a focus on carbon sequestration and ensuring that rural Scotland benefits from carbon markets.

However, others raised concerns around potential for carbon sequestration to contribute to land price inflation, and called for stronger regulation of carbon markets and support for ‘high integrity nature-based carbon credits’. The need to expand the range of markets beyond carbon credits and to reflect other nature-based goods and services was thought necessary to diversify the range of potential motivations for investment in natural capital.

Proposals for use of investment from natural capital to support national benefits

In terms of the overall approach to delivery of national benefits, it was suggested that a more holistic approach to ecosystem management is needed, identifying potential for natural capital to support multiple benefits for communities, investors and the national interest. Pilot RLUPs were highlighted as providing potential models for collective planning processes to support this type of holistic approach. Respondents also highlighted the role of communities and deliberative democracy in informing use of investment to support national benefits.

Proposals for use of investment from natural capital to support national benefits showed significant overlap with proposals for use of investment to support community-level benefits. Proposals made in relation to community benefits which were identified as having potential to support national benefit included use of fiscal mechanisms and taxation such as: levies on profit from natural capital and carbon markets; reform of inheritance and capital gains taxes; development of a land value tax; proposals for funds to support community and national benefits such as a Community Wealth Fund; strengthening of regulation including a particular focus on ensuring carbon markets support community and national benefits; and facilitating alternative ownership models to support community and national interests.

Other proposals for use of investment from natural capital to support national benefits included requiring natural capital projects to set out a clear account of how they will support national benefits, including specific reference to outcomes set out in Scotland’s Biodiversity Strategy 2022-2045. The spatial strategy set out in the draft NPF4 was also identified as having potential to shape investment in natural capital.

There were also calls for improvement to monitoring and reporting of progress towards national climate and nature targets. This included proposals for a national reporting mechanism to collate local authority-level information on biodiversity enhancement and climate change, and the need for improved understanding of embodied carbon across Scotland was highlighted. There was also reference to biodiversity offsetting policy in England as a potential model for diversification of natural capital markets beyond carbon credits.

Other suggestions included:

  • A requirement for new woodland projects for sequestration to include a fixed percentage of native species, with a minimum of 50% was proposed.
  • Prioritisation of reduction in grazing pressures over fencing to allow natural regeneration.
  • Use of investment to support ecological land management and nature restoration including regenerative and agroecological farming and local food infrastructure.

Approaches to encourage new entrants to nature-based sectors were also proposed, for example through joint venture mechanisms such as contract farming, partnerships, share farming, tenancies and leasing arrangements. Options to tackle barriers to tenants engaging in ecosystem markets were suggested, including through contracts allowing tenants to participate in natural capital schemes.

There was also support for potential fiscal mechanisms and use of levies/taxation to encourage diversification of land ownership: in addition to potential taxation reform discussed earlier in relation to potential community benefits, respondents proposed income tax relief for new entrants.

It was also suggested that investment from natural capital could be used to:

  • Support investment in local traditional construction materials to enhance rural economies while supporting national low-carbon and sustainability outcomes. This included a suggestion that options for a Material Passport scheme should be explored.
  • Address a need for retirement housing.

Question 44 – Do you have any additional ideas or proposals for Land Reform in Scotland?

Around 270 respondents answered Question 44.

Topics already covered extensively at earlier questions are not repeated in the analysis here. Additionally, some respondents submitted their own publications as sources of additional proposals: these are beyond a brief review of this kind but are available to the Scottish Government policy team.

Focus on land management rather than land ownership

Some respondents argued that the Scottish Government should focus on the quality of land management rather than its ownership, or that there should be greater recognition of the positive roles that many large-scale landowners play in achieving current policy objectives including ecosystem recovery. There was concern that measures focusing on land ownership could inhibit investment, innovation and structural change or that land fragmentation could result in loss of land-based employment, exacerbating rural depopulation, poverty, and unemployment.

It was argued that the Scottish Government should review existing legislation, mechanisms and structures that can help deliver their policy aims before introducing further legislation.

As an alternative to proposals outlined in the consultation paper, it was suggested that the Scottish Government should incentivise landowners to make desired changes – for example, by creating standards the adherence to which is encouraged through grant funding.

Amend existing community rights to buy provisions

Others saw amending existing community rights to buy provisions as a priority, in order to make them fit for the purpose of bringing more land and built assets into community ownership.

Specific proposals included that the Land Reform Bill should:

  • Amend requirements for registering an interest, potentially by making registration of community interest a two-stage process.
  • Extend community timescales for more complex assets and particularly for larger landholdings.
  • Enable a crofting community body to be deemed an eligible community body.
  • Introduce a new community right to buy to address climate change.
  • Consider an urban community right to buy.

With respect to the existing community right to buy for sustainable development, there was a query whether ‘sustainable development’ would encompass development of nature-depleted land into a flourishing ecosystem.

Some respondents referenced difficulties in raising funds for community purchases, and it was suggested there could be a bigger role for environmental NGOs to work with communities to buy land in the interest of both parties, or for greater collaboration including the public and/or private sectors. In particular it was argued that environmental NGOs and communities working together could generate a new wave of ownership diversification based on partnership acquisitions.

Address issues relating to crofting

It was also suggested that the Land Reform Bill should specifically address issues relating to land under crofting tenure.

It was argued that consideration should be given to simplifying crofting community right to buy legislation, which was described as cumbersome and impractical, particularly in relation to mapping requirements. Further points in relation to crofting included that:

  • Crofting areas should be expanded with policy that details criteria that must be fulfilled for a community to have crofting extended to it.
  • Within existing crofting areas, the Scottish Government should use its own landholdings for the creation of crofts.
  • A formula for the valuation of crofting estates is a priority for further community buy-outs to occur.
  • The crofting register and Scottish land register should be amalgamated to prevent duplication of effort and make it easier for people to access information.

Amend community asset transfer provisions

Accountability of public authorities to communities in relation to the implementation of Community Asset Transfer legislation was highlighted as an area some respondents thought should be strengthened, particularly in relation to timeframes for responses to community requests and the scope for removing assets from the scope of the legislation.

Set an upper limit on private land ownership

A number of respondents argued in favour of introducing an upper limit on private land ownership, in some cases citing the recommendation of the Land Reform Review Group[13] that there should be ‘an upper limit on the total amount of land in Scotland that can be held by a private landowner or a single beneficial interest’.

Other suggestions included disincentivising ownership of large land holdings by setting a cap on the amount any individual or land holding can receive in public support or by introducing a land tax based on the area owned.

Take action on housing

Regulate second homes and holiday lets

Suggested actions with respect to housing included introduction of a new planning system use-class to regulate second homes in areas where these are considered to be having a detrimental effect on sustainable development of local communities, or to be acting as a barrier to the ‘rural repopulation’ national outcome set out in the Fourth National Planning Framework (NPF4). Local authorities would be able to classify homes as primary residences, second homes or holiday lets and an owner would need planning permission to change a property’s classification from a primary residence to a second home.

Other suggestions with respect to second homes and holiday lets included powers for:

  • Local authorities to increase Council Tax rates for second homes or to apply to increase LBTT in specific areas in order to reduce prices.
  • Licensing authorities to include an overprovision policy within the licensing regime for holiday lets.

Improve transparency on land ownership by volume house builders

It was also argued that there needs to be greater transparency in respect of the concentration and pattern of land ownership by volume house builders in Scotland, including around strategic land and options. A public interest test was suggested before land is acquired to further strategic housing land banks.

Take action on land values

It was noted that the consultation paper does not reference land valuations and it was argued that accepting ‘open market’ valuations will inhibit widespread progress on land reform in Scotland. It was suggested both that something must be done to regulate the market and prevent land values from continuing to inflate and that the Scottish Land Fund should be increased to help counter rapidly increasing land prices. One idea was that this should be financed by a land value tax.

Clarify access rights

Issues relating to access rights were raised by a number of respondents, albeit from rather different perspectives.

Some respondents argued that it is important for the Land Reform Bill to reference the access rights and responsibilities established by the Land Reform (Scotland) Act 2003 with one view that the absence of any reference to access rights could give the impression that they are not significant and are unrelated to the current programme of land reform. It was suggested the Bill provides an opportunity to ensure that those with large land holdings are taking their statutory responsibilities seriously. Proposals included:

  • Setting out landowner duties and responsibilities relating to Scottish access in the legislation, together with the obligations of responsible access users.
  • Inclusion of access rights and access provision in LRRS protocols and as a section of Land Management Plans.
  • Giving local authorities greater powers to remove obstructions, such as locked gates and fences, and considering a legally binding arbitration process to address any landowner/local authority issues as a more effective way of maintaining free access.

It was also reported that landowner objections can stall progress on developing active travel routes. To avoid this, it was suggested that new Core Paths could be identified for active travel routes and their adoption achieved through the current Core Path Review process, although it was noted that new legislation would be required to give the local authority powers to upgrade Core Paths to standards suitable for active travel without having to first gain permission from landowners. It was also suggested that active travel routes should be given more backing in terms of compulsory purchase orders.

From a different perspective, a Representative body respondent noted that many of their members have reported significant business impacts caused by access problems. They argued that a full review of the Scottish Outdoor Access Code is long overdue and that, where access problems arise there is little currently or no help available to find solutions.

Maintain consistency with other policy areas

The importance of alignment of the Land Reform Bill with other legislation, including the Agriculture Bill, the Community Wealth Building Bill and the Human Rights Bill was emphasised. One suggestion was that legislation should be framed within an overarching policy framework for a Wellbeing Economy, working towards multiple policy agendas.

It was also suggested that the Bill may require amendment to other related areas of law, such as crofting, agricultural holdings, and community empowerment legislation.

A concern was raised that new legislation could undermine either deployment of onshore wind or other renewable energy projects, and the importance of coherence between the Land Reform Bill and existing renewable energy legislation and policies was highlighted. It was also argued that the consultation document does not demonstrate how further land reform will help Scotland achieve net zero, and that there should be action to support landowning businesses to help address climate change at landscape scale.

Other suggestions

Among a wide range of other proposals suggested by respondents, the one raised most frequently was reforming inheritance law so that estates are split equally amongst inheritors rather than passed whole to the eldest child.

Other suggestions included:

  • Creating a National Land Policy to bring together the set of aims and objectives set by government for dealing with land issues.
  • Reforming charity law to prevent charitable trusts being used to preserve control over land without paying taxes.
  • Ensuring regulation is applied to off market sales.
  • Ensuring community benefits are realised by making community benefit aspects a requirement of public funding or approval processes.
  • Encouraging banks to prioritise productive lending.
  • Introducing a residency requirement for landowners.
  • Giving communities an automatic right to take ownership of the foreshore in their areas.
  • Providing a community training/empowerment program.
  • Extending Permitted Development rights and planning reform for port authorities.
  • Supporting agroecological farming, including by identifying suitable land and facilitating ownership and tenancies that support increased agroecological holdings.
  • Ensuring that sources of important traditional construction materials are not sterilised through development but can be utilised to benefit local communities. It was suggested this could include quarries, woodland and sources of traditional thatching materials.
  • Considering how the Bill could help artists who make ‘site specific’ artworks within landscapes. It was suggested access to information on who owns land in a particular location, and having protocols to request permissions to make and site artworks within landscapes, will improve the paid opportunities for artists in this sector.

Queries were also raised with respect to:

  • The anticipated role of local authorities and RLUPs in land reform?
  • Whether Scottish Ministers have any plans for the commencement of section 99 (Tenant’s right to buy: removal of requirement to register) of the Land Reform (Scotland) Act 2016?



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