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Total Federal US Tax Revenues in 2021: $4.05 trillion Total US Mortgages in 2021: $17.1 trillion Once you add the taxes for other jurisdictions of government I

by TimPC 4y ago

Total Federal US Tax Revenues in 2021: $4.05 trillion Total US Mortgages in 2021: $17.1 trillion Once you add the taxes for other jurisdictions of government I can see taxes reaching 30% of total mortgage value. It's fairly clear to me that owning land is extremely expensive in a Georgist society that needs to generate the levels of taxation that fund current government. If land value tax replaces income tax it needs to be fairly large, taking over 20% of mortgage value for just federal costs. Some number of homes are owned outright and no longer have mortgages so the mortgage number may be a bit misleading. If we account for this we might get to a level that suggests 10% of mortgage value in taxes federally, raising to 15% of mortgage value when accounting for other levels of government. Such numbers suggest you'd need to be able to pay for your current property with an 8-year mortgage in order to pay the Georgist taxes on it. I think a modern society that kept existing levels of government spending would see widespread downgrades in housing quality in a Georgist society.

TimPC 4y ago
To be clear I'm not saying that Georgist taxes are based on the mortgage value I know they are not. I'm comparing the two quantities to establish a rough estimation of how expensive property in a Georgist society that provided a similar level of services would be. If government needed to generate a certain amount of tax revenue comparable to current tax revenue they likely need to charge homeowners an average tax on their unimproved land value that would roughly amount to 15+% of the value of the mortgage, across all levels of government.
- geocon 4y ago
  Except that's not how Georgist tax structure is decided, it is 100% of the land's rental value. If you want a good overview I recommend this exhaustive and data-heavy series of articles: https://gameofrent.com/content/progress-and-poverty-review https://gameofrent.com/content/progress-and-poverty-review
  - TimPC 4y ago
    Okay some things don't add up. You can't have a Georgist tax as a single revenue source for the government and calculate it off something other than what the government needs for revenue. Either you calculate the Georgist tax rate on the unimproved land value, you add other taxes to government or you slash and burn through government spending to deal with the capped revenue. It's living in fantasy land to say Georgist land value taxes, calculated in precise accordance with this metric and not adjusted upward or downward by revenue needs will be a single source of revenue for all levels of government.
    - geocon 4y ago
      Well, while Georgism is most famous for advocating for land value taxation the LVT itself is not the only Georgist tax. All forms of economic land, including such things as natural resources and intellectual property, also generate economic rents and are candidates for taxation. Furthermore, cutting taxes on labor and capital increases the value of land significantly, so much of the revenue "lost" by cutting income taxes, sales taxes, corporate taxes etc would flow directly back into land values and return via the LVT. In any case, there is lots of room for experimentation at the margins and any Georgist reform won't be complete or overnight. Any shift from taxing labor and capital will result in a better and more efficient economy, so don't get too caught up in the abstract end state.
      - AnimalMuppet 4y ago
        > All forms of economic land, including such things as natural resources and intellectual property, also generate economic rents and are candidates for taxation. That fixes my biggest complaint about Georgism. Take Google, for instance. What is the basis of their income? It's not the land they own or occupy. It's that they own google.com. Where does IBM's money come from? Not from the land they own in upstate New York. It comes from their patent portfolio.
      - dragonwriter 4y ago
        > All forms of economic land, including such things as natural resources and intellectual property, also generate economic rents Natural resources are consumed inputs and don't generate rents (extraction rights, which are a subset of property rights in land, do); intellectual property isn't land in the usual economic sense (it is not naturally occuring, so not land; it is durable and created, and therefore capital in the classic division.) It does generate rents, but that's typical of capital goods generally. (In modern use it's more typical to expand the use of “capital” to include land and thereby encompass durable, rent-generating subjects of property rights than to expand “land”.)
- deleted 4y ago
  [deleted]
imtringued 4y ago
You are ignoring that income taxes and other taxes reduce land rents. You can't tax the same dollar twice after all. The entire reasoning behind a single tax system is that every dollar is taxed through land value taxes in this case. Yes this does mean that renting/owning low density housing will be more expensive but your income will be much higher to begin with as it isn't taxed. For example 20% VAT and 30% income tax mean 56% of your money can be spent on housing. Without those taxes you will have almost twice as much money to spend which means you can afford higher land value taxes and if you decrease the amount of land you use, your effective tax burden will go down but so do the costs to maintain infrastructure and other public services.
pwinnski 4y ago
You're saying that land taxes should supply 100% of federal tax revenue, but 0% of state/local revenue? Currently most property taxes are local, not federal. You're also missing the bit about a citizen's dividend which seeks to offset some of this.

by TimPC 4y ago

TimPC 4y ago

To be clear I'm not saying that Georgist taxes are based on the mortgage value I know they are not. I'm comparing the two quantities to establish a rough estimation of how expensive property in a Georgist society that provided a similar level of services would be. If government needed to generate a certain amount of tax revenue comparable to current tax revenue they likely need to charge homeowners an average tax on their unimproved land value that would roughly amount to 15+% of the value of the mortgage, across all levels of government.

geocon 4y ago
Except that's not how Georgist tax structure is decided, it is 100% of the land's rental value. If you want a good overview I recommend this exhaustive and data-heavy series of articles: https://gameofrent.com/content/progress-and-poverty-review https://gameofrent.com/content/progress-and-poverty-review
- TimPC 4y ago
  Okay some things don't add up. You can't have a Georgist tax as a single revenue source for the government and calculate it off something other than what the government needs for revenue. Either you calculate the Georgist tax rate on the unimproved land value, you add other taxes to government or you slash and burn through government spending to deal with the capped revenue. It's living in fantasy land to say Georgist land value taxes, calculated in precise accordance with this metric and not adjusted upward or downward by revenue needs will be a single source of revenue for all levels of government.
  - geocon 4y ago
    Well, while Georgism is most famous for advocating for land value taxation the LVT itself is not the only Georgist tax. All forms of economic land, including such things as natural resources and intellectual property, also generate economic rents and are candidates for taxation. Furthermore, cutting taxes on labor and capital increases the value of land significantly, so much of the revenue "lost" by cutting income taxes, sales taxes, corporate taxes etc would flow directly back into land values and return via the LVT. In any case, there is lots of room for experimentation at the margins and any Georgist reform won't be complete or overnight. Any shift from taxing labor and capital will result in a better and more efficient economy, so don't get too caught up in the abstract end state.
    - AnimalMuppet 4y ago
      > All forms of economic land, including such things as natural resources and intellectual property, also generate economic rents and are candidates for taxation. That fixes my biggest complaint about Georgism. Take Google, for instance. What is the basis of their income? It's not the land they own or occupy. It's that they own google.com. Where does IBM's money come from? Not from the land they own in upstate New York. It comes from their patent portfolio.
    - dragonwriter 4y ago
      > All forms of economic land, including such things as natural resources and intellectual property, also generate economic rents Natural resources are consumed inputs and don't generate rents (extraction rights, which are a subset of property rights in land, do); intellectual property isn't land in the usual economic sense (it is not naturally occuring, so not land; it is durable and created, and therefore capital in the classic division.) It does generate rents, but that's typical of capital goods generally. (In modern use it's more typical to expand the use of “capital” to include land and thereby encompass durable, rent-generating subjects of property rights than to expand “land”.)
deleted 4y ago
[deleted]

imtringued 4y ago

You are ignoring that income taxes and other taxes reduce land rents. You can't tax the same dollar twice after all. The entire reasoning behind a single tax system is that every dollar is taxed through land value taxes in this case. Yes this does mean that renting/owning low density housing will be more expensive but your income will be much higher to begin with as it isn't taxed. For example 20% VAT and 30% income tax mean 56% of your money can be spent on housing. Without those taxes you will have almost twice as much money to spend which means you can afford higher land value taxes and if you decrease the amount of land you use, your effective tax burden will go down but so do the costs to maintain infrastructure and other public services.

pwinnski 4y ago

You're saying that land taxes should supply 100% of federal tax revenue, but 0% of state/local revenue? Currently most property taxes are local, not federal. You're also missing the bit about a citizen's dividend which seeks to offset some of this.