3 ms·

Maybe I'm misunderstanding something but I think the point of Land Value Tax is that it is set based on the value of the things that could be built on that land

by 988747 4y ago

Maybe I'm misunderstanding something but I think the point of Land Value Tax is that it is set based on the value of the things that could be built on that land, not ones that currently are located there. So, you have a lot of land with a single family home, but you are taxed for it as if 20-unit apartment building was standing there. Which, in the long run, incentivizes you to sell your home to some developer that would actually build such building. Now you can discuss if that's fair approach, or just a way to force people out of their homes.

robocat 4y ago
> Land Value Tax is that it is set based on the value of the things that could be built on that land, not ones that currently are located there Everything I have read just uses nearby property prices. Very similar to GV valuations as we currently do in New Zealand with our council rates (just use that figure rather than another). As market prices shift, your Capital Value remains relatively constant (maybe inflation less depreciation), and the Land Value shifts to meet market value (usually upwards, whenever your property rating is updated). In New Zealand we currently have a partial land-value-tax called rates, although they are usually far below LVT suggested taxation rates. Rates are low, but still a significant drain. Mortgages are also similar to a LVT - your mortgage has to pay the land value - and that is certainly more than suggested LVT. Apparently the point of an LVT is not to get revenues, so I don’t quite understand how that works. An incentive that is less than a mortgage already is - hmmmmmm - how can that help? Ironically house prices are set by people bidding against each other for how big their mortgage can be - See: https://news.ycombinator.com/item?id=34097478 https://news.ycombinator.com/item?id=34097478 Because of the above, a LVT perhaps won’t shift house prices, just shift money from private equity to government? The arguments I have read are usually so vague and seem to always miss critical details. I am not a property or economics specialist, yet I see glaring problems and omissions in well received blogs: that doesn’t bode well for the idea IMHO.

by 988747 4y ago

robocat 4y ago

> Land Value Tax is that it is set based on the value of the things that could be built on that land, not ones that currently are located there Everything I have read just uses nearby property prices. Very similar to GV valuations as we currently do in New Zealand with our council rates (just use that figure rather than another). As market prices shift, your Capital Value remains relatively constant (maybe inflation less depreciation), and the Land Value shifts to meet market value (usually upwards, whenever your property rating is updated). In New Zealand we currently have a partial land-value-tax called rates, although they are usually far below LVT suggested taxation rates. Rates are low, but still a significant drain. Mortgages are also similar to a LVT - your mortgage has to pay the land value - and that is certainly more than suggested LVT. Apparently the point of an LVT is not to get revenues, so I don’t quite understand how that works. An incentive that is less than a mortgage already is - hmmmmmm - how can that help? Ironically house prices are set by people bidding against each other for how big their mortgage can be - See: https://news.ycombinator.com/item?id=34097478 https://news.ycombinator.com/item?id=34097478 Because of the above, a LVT perhaps won’t shift house prices, just shift money from private equity to government? The arguments I have read are usually so vague and seem to always miss critical details. I am not a property or economics specialist, yet I see glaring problems and omissions in well received blogs: that doesn’t bode well for the idea IMHO.