Thursday, June 25, 2009

Calls for new tax scheme to fund £850m Northern Line extension

Mayor of London Boris Johnson, Transport for London and Wandsworth and Lambeth councils have written to the government to call for a new tax to help fund an extension of the northern line to Battersea Power Station.

The bodies want John Healy, minister for local government, to employ Tax Increment Financing (TIF) to fund the ВЈ850m project, according to Estates Gazette.

The letter says that the extension is crucial to the success of ambitious plans to regenerate more than 200 acres in the Battersea and Nine Elms opportunity area.

The tax model, which is common in the US, would involve councils selling bonds to forward fund infrastructure.

That money would then be repaid via an increase in business rates when the regeneration of an area was completed.


Calls for new tax scheme to fund £850m Northern Line extension


Pilot schemes are expected to be announced by the government in the Pre Budget report this autumn.

Mayor of London Boris Johnson is also understood to have agreed to divert money that he had proposed to raise for Crossrail via a levy on commercial development in the area towards funding the Northern Line extension.