4 ms·

They generally locate where they can draw on a pool of talented people, and those people are drawn by social amenities, good schools, good infrastructure. All

by LVTfan 6y ago

They generally locate where they can draw on a pool of talented people, and those people are drawn by social amenities, good schools, good infrastructure. All those things contribute to land value.

CydeWeys 6y ago
You're not being concrete. How do you properly tax a tech company whose land allocation is negligible compared to the overall value of the company? Tech companies have less than 1% of their value tied up in land. If they're all-remote and cloud-based, then they have $0 in land. How would you even tax them if the only tax is based on land? Also, I live in an apartment. Should my tax be $0? Or if I owned and lived on land way out in a rural area where a small plot is only worth a few thousand bucks, do I only pay tax on that despite my income being mid six figures? The point is, as a knowledge worker, my economic productivity is entirely divorced from land. This is true of most white collar workers. Land value taxes may have made sense as the primary tax hundreds of years ago but they don't make sense for that purpose now.
- xiphias2 6y ago
  The whole point of this tax type is encouraging efficiency. Tech companies are usually efficient, and taxing them less increases their efficiency even more. At the same time their harmful effects should be regulated (GDPR is an example of such regulation). Countries and states that let tech companies thrive are winning the race for capital.
  - CydeWeys 6y ago
    The whole point of taxes is to fund government spending. That is a large amount of money you need to bring in every year. Taxing based on income seems to make the most sense for that, not "taxing based on efficiency". If tech companies have billions of dollars but aren't paying taxes just because their business doesn't happen to use land, how does that make sense? Why is land efficiency the only thing that matters? The government needs to fund its spending, and they're not going to ignore large profitable tech companies for taxation merely because said industries happen to not be land-intensive.
    - bluecalm 6y ago
      Who do you think should pay more taxes: someone sitting on 10M worth of land and doing nothing or a factory worker with no assets making 20$/hour? Income tax is unfair. It taxes productive people instead of those who benefits the most from the stable system (land owners).
      - sudosysgen 6y ago
        Who do you think should pay more taxes: someone with a house in Brooklyn or a multi millionaire tech worker with a remote SaaS company?
        epistasis 6y ago
        By occupying that space in Brooklyn, that landowner excludes others from the opportunities that they enjoy. The land, which the homeowner didn't create, has tons of benefits that accrue only to the owner that come not from the owner's labor, but from the labor of others that are nearby, merely by being close to all those other people. So how much does that Brooklyn homeowner owe to the rest of society for excluding others from what they enjoy? How much does the SaaS millionaire exclude others from opportunities? Many proposed economic systems distinguish between property that comes from your own labor, and profits that come from idly owning an asset and restricting its use by others in certain ways. The slogan "property is theft" doesn't refer to the bookshelf that a person crafted, it refers to real estate and the economic systems of the time that excludes so many people from the opportunity to escape the economic rents of those who were born with more wealth and privilege. There are many reasons to tax things: to make life more fair, to raise funds for government, to improve economic efficiency, to reduce pollution. It's so hard to say who should be taxed more without baseline values!
    - deleted 6y ago
      [deleted]
  - sudosysgen 6y ago
    The point of taxes is absolutely not to encourage efficiencies. The point of taxes is to fund the state in order to provide for defense and palliate the ills of capitalism.
    - xiphias2 6y ago
      I didn't write about the point of taxes, but about the point of a type of taxation. A government can collect the same amount of tax with different rules and procedures. I agree with you, providing defense and protecting real capitalism, stopping oligarchies/long term monopolies from forming is important, to be able to have a return on investment on the taxed capital in the country. As I wrote before, countries are competing for investor money, that's why it's important how they collect and distribute taxes. The counterforce is usually corruption inside the political system though.
    - epistasis 6y ago
      But what if we could do both! Markets need massive amounts of legal structure and regulation to make them efficient. Including taxation as part of that is an excellent idea. And if we get to Piketty-inspired corrections for r>g, part of that will include eliminating economic rents the way a LVT does.
- LVTfan 6y ago
  How much of the rent on your apartment is due to its location? might be 10% in a small town, but it is likely more like 50% in most cities (unless the landlord is providing a lot of services -- doorman, flowers in the lobby). In his land value tax, he'd be paying for the value of the site. In a highrise, that value gets used by dozens of housing units in each column. You wouldn't see a tax bill because you're not a landowner. But you'd be paying your share via your monthly rent. And your rent would not rise: your landlord is already charging what the market will bear. And if there is a vacant lot next door, its owner would be motivated to build on it or sell to someone who would. That would likely reduce the rise in your monthly rent.
javitury 6y ago
The goal is to make the tax system not to reduce incentives to increase skills, labor, or technology. "George preferred taxing unimproved land value"
- snidane 6y ago
  George was for removing taxes altogether which is possible if you fund government services properly in a pay for what you use scheme. It is not good politics to start your political campaign by proclaiming that you will remove all taxes altogether because it is so far out of anyone's reality that he would have been considered crazy.
LVTfan 6y ago
And those who are late to the game and buy a piece of land comparable to their entrenched competitor who bought years ago are paying multiples of the property tax. Those late to the game who decide to rent are paying rents based on current land values, but their landlords, who may have owned the property for 10, 20, 30, 40 years, are paying to the community based on their purchase price. It becomes a form of sharecropping. Landlording can be very profitable, especially in California, if you own or inherit property from someone who bought it decades ago. Cui bono?

by LVTfan 6y ago

They generally locate where they can draw on a pool of talented people, and those people are drawn by social amenities, good schools, good infrastructure. All those things contribute to land value.

CydeWeys 6y ago

You're not being concrete. How do you properly tax a tech company whose land allocation is negligible compared to the overall value of the company? Tech companies have less than 1% of their value tied up in land. If they're all-remote and cloud-based, then they have $0 in land. How would you even tax them if the only tax is based on land? Also, I live in an apartment. Should my tax be $0? Or if I owned and lived on land way out in a rural area where a small plot is only worth a few thousand bucks, do I only pay tax on that despite my income being mid six figures? The point is, as a knowledge worker, my economic productivity is entirely divorced from land. This is true of most white collar workers. Land value taxes may have made sense as the primary tax hundreds of years ago but they don't make sense for that purpose now.

xiphias2 6y ago
The whole point of this tax type is encouraging efficiency. Tech companies are usually efficient, and taxing them less increases their efficiency even more. At the same time their harmful effects should be regulated (GDPR is an example of such regulation). Countries and states that let tech companies thrive are winning the race for capital.
- CydeWeys 6y ago
  The whole point of taxes is to fund government spending. That is a large amount of money you need to bring in every year. Taxing based on income seems to make the most sense for that, not "taxing based on efficiency". If tech companies have billions of dollars but aren't paying taxes just because their business doesn't happen to use land, how does that make sense? Why is land efficiency the only thing that matters? The government needs to fund its spending, and they're not going to ignore large profitable tech companies for taxation merely because said industries happen to not be land-intensive.
  - bluecalm 6y ago
    Who do you think should pay more taxes: someone sitting on 10M worth of land and doing nothing or a factory worker with no assets making 20$/hour? Income tax is unfair. It taxes productive people instead of those who benefits the most from the stable system (land owners).
    - sudosysgen 6y ago
      Who do you think should pay more taxes: someone with a house in Brooklyn or a multi millionaire tech worker with a remote SaaS company?
      - epistasis 6y ago
        By occupying that space in Brooklyn, that landowner excludes others from the opportunities that they enjoy. The land, which the homeowner didn't create, has tons of benefits that accrue only to the owner that come not from the owner's labor, but from the labor of others that are nearby, merely by being close to all those other people. So how much does that Brooklyn homeowner owe to the rest of society for excluding others from what they enjoy? How much does the SaaS millionaire exclude others from opportunities? Many proposed economic systems distinguish between property that comes from your own labor, and profits that come from idly owning an asset and restricting its use by others in certain ways. The slogan "property is theft" doesn't refer to the bookshelf that a person crafted, it refers to real estate and the economic systems of the time that excludes so many people from the opportunity to escape the economic rents of those who were born with more wealth and privilege. There are many reasons to tax things: to make life more fair, to raise funds for government, to improve economic efficiency, to reduce pollution. It's so hard to say who should be taxed more without baseline values!
  - deleted 6y ago
    [deleted]
- sudosysgen 6y ago
  The point of taxes is absolutely not to encourage efficiencies. The point of taxes is to fund the state in order to provide for defense and palliate the ills of capitalism.
  - xiphias2 6y ago
    I didn't write about the point of taxes, but about the point of a type of taxation. A government can collect the same amount of tax with different rules and procedures. I agree with you, providing defense and protecting real capitalism, stopping oligarchies/long term monopolies from forming is important, to be able to have a return on investment on the taxed capital in the country. As I wrote before, countries are competing for investor money, that's why it's important how they collect and distribute taxes. The counterforce is usually corruption inside the political system though.
  - epistasis 6y ago
    But what if we could do both! Markets need massive amounts of legal structure and regulation to make them efficient. Including taxation as part of that is an excellent idea. And if we get to Piketty-inspired corrections for r>g, part of that will include eliminating economic rents the way a LVT does.
LVTfan 6y ago
How much of the rent on your apartment is due to its location? might be 10% in a small town, but it is likely more like 50% in most cities (unless the landlord is providing a lot of services -- doorman, flowers in the lobby). In his land value tax, he'd be paying for the value of the site. In a highrise, that value gets used by dozens of housing units in each column. You wouldn't see a tax bill because you're not a landowner. But you'd be paying your share via your monthly rent. And your rent would not rise: your landlord is already charging what the market will bear. And if there is a vacant lot next door, its owner would be motivated to build on it or sell to someone who would. That would likely reduce the rise in your monthly rent.

javitury 6y ago

The goal is to make the tax system not to reduce incentives to increase skills, labor, or technology. "George preferred taxing unimproved land value"

snidane 6y ago
George was for removing taxes altogether which is possible if you fund government services properly in a pay for what you use scheme. It is not good politics to start your political campaign by proclaiming that you will remove all taxes altogether because it is so far out of anyone's reality that he would have been considered crazy.

LVTfan 6y ago

And those who are late to the game and buy a piece of land comparable to their entrenched competitor who bought years ago are paying multiples of the property tax. Those late to the game who decide to rent are paying rents based on current land values, but their landlords, who may have owned the property for 10, 20, 30, 40 years, are paying to the community based on their purchase price. It becomes a form of sharecropping. Landlording can be very profitable, especially in California, if you own or inherit property from someone who bought it decades ago. Cui bono?