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A land tax trickles down as increased agricultural and housing prices. So it's strongly recessive, that is, it affects the poor to a much greater proportion tha

A land tax trickles down as increased agricultural and housing prices. So it's strongly recessive, that is, it affects the poor to a much greater proportion than the rich. The US before 1913 was a largely agricultural nation with strong equality due to fair capital allocation, free land distributed to homesteaders, manifest destiny and all that. Dispensing current means of income redistribution would mean reverting to a much more feudal, almost primitive state. The vast majority of people would have no agricultural property and no capital, just wages paid by immensely wealthy global capitalists that wouldn't owe any taxes.

throwaway2048 8y ago
The idea that all taxes are ultimately paid for by consumers is dangerous, stupid and misleading. If companies/people could charge you more for whatever you are buying, they would. Taxation is largely paid for by reduced profitability, not increased prices. Land taxes are one of the only ways to tax non-productive, rentier style wealth that has lots of fixed assets, and merely sits on them extacting money with very little positive economic input. Since it is they who are typically the most responsible for soaring housing and real estate prices (they buy properties and then do nothing with them, often times not even renting them out), to suggest such taxes are "strongly regressive" is pretty much exactly the opposite of reality. Under a system with strong land taxes, such parties are incentivised strongly to either sell to people who want the land more (can make more money off of it by increasing density, thus pay more taxes) or to do so themselves. In a world without property tax, they are incentivised to just sit on the property forever, and do nothing to it, waiting for a huge payday far into the future.
- cornholio 8y ago
  Agricultural producers have razor thin margins almost anywhere in the world and face strong international competition. The rent seeking landowner gouging consumers through food prices is an ideological fantasy. Quite the opposite, there is a strong tendency to overproduction and subsidies. A large land tax in such an ECON101 postcard-perfect market will immediately increase the costs of inputs to the point where production no longer makes economic sense. Either through decreased production or tariff protectionism the food prices will rise, passing the tax to consumers. That's not say taxes are always passed down to consumers, that's a pure straw-man you conjure to hurl insults. But in these two cases, they are, to an overwhelming degree.
  - haihaibye 8y ago
    A land tax would reduce the price of land, and farmers would borrow less in the future to buy it. In effect it would probably be a one off hit to real estate prices. I think the distortions of a land tax are better than others and support it. I own real estate but it's only 5x my wage, the current system sucks - taxing human effort and creativity is about the worst thing you can tax.
    - cornholio 8y ago
      Clearly, a tax on arable land would devalue it. But that doesn't mean it wouldn't also be reflected in food prices - and that is the absolute worst thing you can tax. As for income taxes, they don't really tax creativity and human effort, except if you think of the world as a perfect meritocratic utopia where everyone has infinite positive liberties. But in that case, you wouldn't really need to tax anybody. The revenue of an individual is generally strongly dependent on the social infrastructure they use to generate it. The same person, transplanted into another area of the world with less functional social institutions will generate orders of magnitude less money. For example, an American or British medic moving to the peaceful and English speaking country of Ghana: same creativity and effort, 5-10x less revenue, purchasing parity adjusted. It's only natural then for him to pay for his access to the rich society, thus enabling the public investments that allow such a rich society to exist in the fist place.
      - njarboe 8y ago
        The people are the rich society. The people are the social infrastructure, created by them and their ancestors. Not seeing much positive investment by government these days for that 50% overhead.
        cornholio 8y ago
        How fast do you reckon the basic infrastructure would crumble without any public investment ? What would the crime rate be without any social transfers, food stamps, public education, jobs created in and by the government? How fast would society descend to gang war and warlords, absent any public defense and policing efforts? The ideea that Americans or the British possess a hereditary, almost magical capacity to self organize in the absence of fiscal revenue, that other lesser civilised people lack, is deliciously naive. That's not to say the governments of rich countries is the pinnacle of efficiency or forethought and shouldn't be kept strictly in check. But that much worse is possible, and that the failure of government has such drastic consequences to make 50% of your revenue the least of your concerns.

throwaway2048 8y ago

The idea that all taxes are ultimately paid for by consumers is dangerous, stupid and misleading. If companies/people could charge you more for whatever you are buying, they would. Taxation is largely paid for by reduced profitability, not increased prices. Land taxes are one of the only ways to tax non-productive, rentier style wealth that has lots of fixed assets, and merely sits on them extacting money with very little positive economic input. Since it is they who are typically the most responsible for soaring housing and real estate prices (they buy properties and then do nothing with them, often times not even renting them out), to suggest such taxes are "strongly regressive" is pretty much exactly the opposite of reality. Under a system with strong land taxes, such parties are incentivised strongly to either sell to people who want the land more (can make more money off of it by increasing density, thus pay more taxes) or to do so themselves. In a world without property tax, they are incentivised to just sit on the property forever, and do nothing to it, waiting for a huge payday far into the future.

cornholio 8y ago
Agricultural producers have razor thin margins almost anywhere in the world and face strong international competition. The rent seeking landowner gouging consumers through food prices is an ideological fantasy. Quite the opposite, there is a strong tendency to overproduction and subsidies. A large land tax in such an ECON101 postcard-perfect market will immediately increase the costs of inputs to the point where production no longer makes economic sense. Either through decreased production or tariff protectionism the food prices will rise, passing the tax to consumers. That's not say taxes are always passed down to consumers, that's a pure straw-man you conjure to hurl insults. But in these two cases, they are, to an overwhelming degree.
- haihaibye 8y ago
  A land tax would reduce the price of land, and farmers would borrow less in the future to buy it. In effect it would probably be a one off hit to real estate prices. I think the distortions of a land tax are better than others and support it. I own real estate but it's only 5x my wage, the current system sucks - taxing human effort and creativity is about the worst thing you can tax.
  - cornholio 8y ago
    Clearly, a tax on arable land would devalue it. But that doesn't mean it wouldn't also be reflected in food prices - and that is the absolute worst thing you can tax. As for income taxes, they don't really tax creativity and human effort, except if you think of the world as a perfect meritocratic utopia where everyone has infinite positive liberties. But in that case, you wouldn't really need to tax anybody. The revenue of an individual is generally strongly dependent on the social infrastructure they use to generate it. The same person, transplanted into another area of the world with less functional social institutions will generate orders of magnitude less money. For example, an American or British medic moving to the peaceful and English speaking country of Ghana: same creativity and effort, 5-10x less revenue, purchasing parity adjusted. It's only natural then for him to pay for his access to the rich society, thus enabling the public investments that allow such a rich society to exist in the fist place.
    - njarboe 8y ago
      The people are the rich society. The people are the social infrastructure, created by them and their ancestors. Not seeing much positive investment by government these days for that 50% overhead.
      - cornholio 8y ago
        How fast do you reckon the basic infrastructure would crumble without any public investment ? What would the crime rate be without any social transfers, food stamps, public education, jobs created in and by the government? How fast would society descend to gang war and warlords, absent any public defense and policing efforts? The ideea that Americans or the British possess a hereditary, almost magical capacity to self organize in the absence of fiscal revenue, that other lesser civilised people lack, is deliciously naive. That's not to say the governments of rich countries is the pinnacle of efficiency or forethought and shouldn't be kept strictly in check. But that much worse is possible, and that the failure of government has such drastic consequences to make 50% of your revenue the least of your concerns.