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Worse, if you build an improvement which makes the location more valuable (for example, a tech company building their headquarters and creating demand for nearb

Worse, if you build an improvement which makes the location more valuable (for example, a tech company building their headquarters and creating demand for nearby residential space) then you pay LVT on the value you created. LVT proponents like to pretend that they only want to tax the "intrinsic value" of the land, as if the entire concept of intrinsic value were not thoroughly discredited long ago, but in practice only the physical structure would be exempt from the tax as an "improvement"—anything else would be too subjective. Perhaps if LVT were only assessed on the value of similar unoccupied land far away from all improvements it might be more reasonable… but that would not fulfill the LVT supporters' objectives.

markdown 5y ago
> Worse, if you build an improvement which makes the location more valuable (for example, a tech company building their headquarters and creating demand for nearby residential space) then you pay LVT on the value you created. How is that worse when that's how you are currently taxed? The more value you create, the more money you make, the wealthier you are, the more you get taxed. Except if you're currently a billionaire tax dodger, you can't dodge any more.
- nybble41 5y ago
  > How is that worse when that's how you are currently taxed? It's worse from the point of view of the LVT proponents' argument that the tax is based on the "intrinsic value" of the land and not improvements contributed by the property owner. You're correct that it's not that different from an income tax, but LVT is supposed to be more "fair" than an income tax specifically because it taxes "unearned" natural resources and not the owner's contributions. An income tax, of course, is designed to be exactly the opposite: a tax on earnings from economic activity. This is not to say that an income tax is objectively better than LVT, just that LVT and property tax have more in common than some prefer to admit, mostly because the practical/legal definition of "improvement" (i.e. buildings and other physical changes to the property) does not encompass all economic value created by the owner.

markdown 5y ago

> Worse, if you build an improvement which makes the location more valuable (for example, a tech company building their headquarters and creating demand for nearby residential space) then you pay LVT on the value you created. How is that worse when that's how you are currently taxed? The more value you create, the more money you make, the wealthier you are, the more you get taxed. Except if you're currently a billionaire tax dodger, you can't dodge any more.

nybble41 5y ago
> How is that worse when that's how you are currently taxed? It's worse from the point of view of the LVT proponents' argument that the tax is based on the "intrinsic value" of the land and not improvements contributed by the property owner. You're correct that it's not that different from an income tax, but LVT is supposed to be more "fair" than an income tax specifically because it taxes "unearned" natural resources and not the owner's contributions. An income tax, of course, is designed to be exactly the opposite: a tax on earnings from economic activity. This is not to say that an income tax is objectively better than LVT, just that LVT and property tax have more in common than some prefer to admit, mostly because the practical/legal definition of "improvement" (i.e. buildings and other physical changes to the property) does not encompass all economic value created by the owner.