The way this works is a Land Value Tax (LVT)[0]. The land is still held by individuals, but they pay a use fee based upon the market value of the unimproved la

The way this works is a Land Value Tax (LVT)[0]. The land is still held by individuals, but they pay a use fee based upon the market value of the unimproved land. It's compatible with markets, capitalism, and in fact economists call it the most efficient tax possible. It's also very environmentally friendly, insofar as it encourages efficient use of land, which would spur more infill instead of pushing the margin of land lower and lower, encouraging sprawl. Why don't we use this tax, then? Mostly because it creates losers in the form of landowners, who tend to be extremely powerful, politically. "This arouses furious opposition from landowners, in most countries a potent lobby, see it as highly unfair. They have got used to enjoying their rents and object to their sudden socialisation."[1] If there's an upside, it's that it's been shown to be one of the only effective methods in implementing modern urban design and finance in a sustainable fashion. Just today, London expressed interest in seeing how LVT could remedy its housing crisis.[2] [0] https://en.wikipedia.org/wiki/Land_value_tax https://en.wikipedia.org/wiki/Land_value_tax [1] http://www.economist.com/blogs/freeexchange/2015/04/land-value-tax http://www.economist.com/blogs/freeexchange/2015/04/land-val... [2] https://www.london.gov.uk/press-releases/assembly/mayor-positive-about-a-land-value-tax-trial https://www.london.gov.uk/press-releases/assembly/mayor-posi...