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I fail to see anything in your scenario that couldn't already occur with the current tax system Currently: taxes are based on land+improvements Proposed: taxe

I fail to see anything in your scenario that couldn't already occur with the current tax system Currently: taxes are based on land+improvements Proposed: taxes are based on land Factories move because the value of their land is high under the current system as well. The problem with the current system is that it disincentizes improvements. In my neighborhood of Boston, most of the 100-year old buildings used to be 5 stories. Now they are 3 stories. What happened? People literally dismantled the upper level floors of their buildings to reduce their taxes. In other parts of the country, it is fairly common to tear down a building to reduce the taxes on an unused property. That is what a land tax is designed to eliminate.

AnthonyMouse 11y ago
Oh, land value tax is better in pretty much every way than property tax within a city (or pretty much anywhere that multi-story buildings are feasible). And property tax does cause urban sprawl etc. They're obviously very similar. But that's not the question. The question is, should we have more property/land value tax and less sales/income tax or more sales/income tax and less property/land value tax?
- ArkyBeagle 11y ago
  an answer is yes, we should - the primary function of government is to defend claims on the use of land, and having the "land" pay directly for this is at least of a nice sounding symmetry. And theoretically, people would then be forced to productive investment rather than land speculation.
  - AnthonyMouse 11y ago
    > the primary function of government is to defend claims on the use of land, and having the "land" pay directly for this is at least of a nice sounding symmetry. Some claim that to be the primary function of government but it certainly isn't the primary element of the government budget. > And theoretically, people would then be forced to productive investment rather than land speculation. Thwarting land speculation is literally the same thing as not allowing land values to increase. LVT reduces land values because of the overhang of the future tax payments, but it also has various negative consequences. If you want to keep land values down, enact policies that encourage the construction and occupation of high density housing. In particular, don't explicitly impede it through zoning regulations etc.
    - ArkyBeagle 11y ago
      The value increases. It's just gathered as taxes. Since what is to be done with the rents value is taken care of, you no longer have to concern yourself with it. The improvements - buildings, the like - are still yours. The only thing that is taxed is the increase in value due to position of the land, due to proximity to other such improvements.
      - AnthonyMouse 11y ago
        > The value increases. It's just gathered as taxes. In other words, from the perspective of the land owner, the land value doesn't increase because the added value goes to the tax collector instead of the land owner. Which is true for both the owner/seller and prospective buyers of the land, so the value (meaning market value) of the land doesn't go up. Assuming the tax is perfectly calibrated and the land value estimate is correct before the existence of the tax reduces the market value of the land. Here's the problem right now. Rents are too damn high and people can't afford to live in the city. You pass the land value tax and land market values decrease accordingly because property buyers won't pay as much for land they can't collect as much rent from. But the rents are still too damn high, they're just going to the tax collector instead of the land owner. And people can't build new housing to alleviate the high rents for the same reason they don't already, because zoning regulations prohibit it. Suppose instead we change zoning regulations to allow builders to build several dozen new 50 story skyscrapers full of residential housing in the city. Supply goes up, price goes down. So property values go down and rents go down and now people can afford housing. How is that not better? It gives the "rents" to the tenants instead of the tax collector.
        ArkyBeagle 11y ago
        The interesting thing about land value/rents taxation is that it cannot be passed on to tenants. I think this covers that: http://rationalwiki.org/wiki/Georgism http://rationalwiki.org/wiki/Georgism Hopefully, the rents that are too damn high go to the tax collector instead of an income tax. There is the Henry George "theorem" which states that land rents are always equal to the cost of government. Curiously, I don't really know how this interacts with zoning. I suspect zoning would be completely different if there was no influence from land speculation. I don't hold Geotaxation to be utopian. It's just interesting. Might be an improvement.

AnthonyMouse 11y ago

Oh, land value tax is better in pretty much every way than property tax within a city (or pretty much anywhere that multi-story buildings are feasible). And property tax does cause urban sprawl etc. They're obviously very similar. But that's not the question. The question is, should we have more property/land value tax and less sales/income tax or more sales/income tax and less property/land value tax?

ArkyBeagle 11y ago
an answer is yes, we should - the primary function of government is to defend claims on the use of land, and having the "land" pay directly for this is at least of a nice sounding symmetry. And theoretically, people would then be forced to productive investment rather than land speculation.
- AnthonyMouse 11y ago
  > the primary function of government is to defend claims on the use of land, and having the "land" pay directly for this is at least of a nice sounding symmetry. Some claim that to be the primary function of government but it certainly isn't the primary element of the government budget. > And theoretically, people would then be forced to productive investment rather than land speculation. Thwarting land speculation is literally the same thing as not allowing land values to increase. LVT reduces land values because of the overhang of the future tax payments, but it also has various negative consequences. If you want to keep land values down, enact policies that encourage the construction and occupation of high density housing. In particular, don't explicitly impede it through zoning regulations etc.
  - ArkyBeagle 11y ago
    The value increases. It's just gathered as taxes. Since what is to be done with the rents value is taken care of, you no longer have to concern yourself with it. The improvements - buildings, the like - are still yours. The only thing that is taxed is the increase in value due to position of the land, due to proximity to other such improvements.
    - AnthonyMouse 11y ago
      > The value increases. It's just gathered as taxes. In other words, from the perspective of the land owner, the land value doesn't increase because the added value goes to the tax collector instead of the land owner. Which is true for both the owner/seller and prospective buyers of the land, so the value (meaning market value) of the land doesn't go up. Assuming the tax is perfectly calibrated and the land value estimate is correct before the existence of the tax reduces the market value of the land. Here's the problem right now. Rents are too damn high and people can't afford to live in the city. You pass the land value tax and land market values decrease accordingly because property buyers won't pay as much for land they can't collect as much rent from. But the rents are still too damn high, they're just going to the tax collector instead of the land owner. And people can't build new housing to alleviate the high rents for the same reason they don't already, because zoning regulations prohibit it. Suppose instead we change zoning regulations to allow builders to build several dozen new 50 story skyscrapers full of residential housing in the city. Supply goes up, price goes down. So property values go down and rents go down and now people can afford housing. How is that not better? It gives the "rents" to the tenants instead of the tax collector.
      - ArkyBeagle 11y ago
        The interesting thing about land value/rents taxation is that it cannot be passed on to tenants. I think this covers that: http://rationalwiki.org/wiki/Georgism http://rationalwiki.org/wiki/Georgism Hopefully, the rents that are too damn high go to the tax collector instead of an income tax. There is the Henry George "theorem" which states that land rents are always equal to the cost of government. Curiously, I don't really know how this interacts with zoning. I suspect zoning would be completely different if there was no influence from land speculation. I don't hold Geotaxation to be utopian. It's just interesting. Might be an improvement.