Writing in the Financial Times, Tim Harford, AKA “the Undercover Economist” describes the English tax, introduced in 1696 and lasting until 1851, that was charged on the number of windows in a home, unlike the property taxes of today that are based on value of the property.
The details of the tax varied across the centuries but with the broad theme that the more windows your house had, the more tax you had to pay. At first glance, the tax seems clever, even brilliant. Rich people had larger houses, and so paid more tax. Windows are easy to count from outside the premises, so the tax was easy to assess. Poor people didn’t own large houses, so they weren’t affected by the tax. And the number of windows in a house doesn’t change, so the tax was impossible to avoid.
And it is brilliant. Dare I say that like the windows, it is totally transparent- everyone can see it, if you have a window (which is a big energy hole in the wall) you pay the tax. But Harford says it was “wrong, wrong, wrong” because people adapted their houses accordingly reducing their tax.
A fundamental error is the idea that architecture doesn’t respond to tax incentives. When William Pitt tripled the tax in 1797, thousands of windows were bricked or boarded up almost overnight.
Harford is complaining here that if the window tax was trying to be a fair indicator of wealth, then it failed, because people adapted to it. But really, is this not exactly what we want? Should architecture not respond to tax incentives? Should buildings not have more wall and less window? Is this not totally the point? And in fact, the tax did affect the design of English houses; it was a progressive tax which jumped with the number of windows so that poorer homes with less than ten windows paid no tax, those with ten to fourteen paid sixpence per year and those with 15 to 20 paid yet a higher rate. So a lot of homes were built with just nine windows or just fourteen. The result: less tax to the government, but less heat loss for the homeowner.
So imagine what would happen if we had a window tax today, perhaps based on the square footage of the windows. People would make them smaller, perhaps framing a view instead of having a wall of glass, which is what they should be doing in the first place. This would lead to a significant reduction in heating and cooling costs and a lower carbon footprint. Perhaps there would be a tax credit for offsetting solar panels or Passive House quality windows.
In the end, Harford seems to admit that this makes some sense, and that it is not really all that wrong, wrong, wrong.
There is a useful lesson to be learnt from the window tax: it is that people will respond in quite profound ways to tax incentives. That is why economists often call, more in hope than expectation, for a tax on carbon emissions. People would adjust their behaviour to avoid the tax, which is exactly what we need.
Which is why we should bring it back. Three Huzzahs for ye olde English windowe taxe!