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The same tech could probably be used to calculate a Land Value Tax.

by iNic 3y ago

hiAndrewQuinn 3y ago
A self assessed Harberger tax would be a really good idea with such data available! "The idea is to let each owner assess their property at any value they want, but that assessed value becomes a price at which they offer to sell their property to anyone. (Harberger didn’t invent the idea; it goes back at least to ancient Rome.) Posner and Weyl consider applying this basic idea to most all property, and call it a “Harberger tax.” That is, a simple way to create an incentive for low offer prices on any kind of property is to require the owner of that property to continuously pay a fee proportional to their posted offer price, i.e., the price they announce at which they will sell their property. The lower their price, the less they pay." From OB
- danaris 3y ago
  There's a fairly major problem with that in our current environment: Requiring every property owner—or even every landlord—to offer their property for sale at a reasonable price to anyone who is willing to pay it is guaranteed to funnel most or all properties in a given area to one or a very small number of large corporations, which are then at liberty to dictate conditions to all their tenants (possibly even beyond the minimums the law specifies, if they're powerful enough to ignore that). The only way this can be avoided, IMO, is if the law also specifies the maximum rent that can be charged as a fraction of the value of the property (or the fraction of the property a given unit represents). Otherwise, the large corporations can simply buy all the property that is now always on the market, and charge rents just exorbitant enough to make massive profits, while not being quite enough to drive everyone out of the area.
  - hiAndrewQuinn 3y ago
    There are in fact 2 rebuttals here, one being the econ 101 answer: If I find out that a large company is gobbling up homes for any price I set on them, then I might as well build way more homes in that area because I've got a guaranteed buyer. That argument can still be overruled in the short term by pointing at the current zoning laws of many countries worldwide, and the second rebuttal is more interesting anyway: Who said anything about a 'reasonable' price? The proportionality constant between the tax levied and the listed sales price of the home is a precise instrument. We could just as easily set it to 0.1% per annum, so that people who list their homes for $1m/year still only pay $1000/year in tax and likely never see a serious purchaser, as we could set it to 10% per annum, where a $1m/year house accrues a whopping $100,000/year in Harberger taxes, which leads to people lowering the listed price, WLT many more sales and purchases, WLT considerably more housing liquidity. You could use either tactic to put the squeeze on bad actors, depending on your goals.
- HDThoreaun 3y ago
  This system is problematic in high inequality societies. A rich person may decide to kick you out of your home if they're feeling petty. Many people do not want to move, forcing them to sell against their will is incredibly politically unpopular.

The same tech could probably be used to calculate a Land Value Tax.

by iNic 3y ago

The same tech could probably be used to calculate a Land Value Tax.

A self assessed Harberger tax would be a really good idea with such data available! "The idea is to let each owner assess their property at any value they want, but that assessed value becomes a price at which they offer to sell their property to anyone. (Harberger didn’t invent the idea; it goes back at least to ancient Rome.) Posner and Weyl consider applying this basic idea to most all property, and call it a “Harberger tax.” That is, a simple way to create an incentive for low offer prices on any kind of property is to require the owner of that property to continuously pay a fee proportional to their posted offer price, i.e., the price they announce at which they will sell their property. The lower their price, the less they pay." From OB

danaris 3y ago
There's a fairly major problem with that in our current environment: Requiring every property owner—or even every landlord—to offer their property for sale at a reasonable price to anyone who is willing to pay it is guaranteed to funnel most or all properties in a given area to one or a very small number of large corporations, which are then at liberty to dictate conditions to all their tenants (possibly even beyond the minimums the law specifies, if they're powerful enough to ignore that). The only way this can be avoided, IMO, is if the law also specifies the maximum rent that can be charged as a fraction of the value of the property (or the fraction of the property a given unit represents). Otherwise, the large corporations can simply buy all the property that is now always on the market, and charge rents just exorbitant enough to make massive profits, while not being quite enough to drive everyone out of the area.
- hiAndrewQuinn 3y ago
  There are in fact 2 rebuttals here, one being the econ 101 answer: If I find out that a large company is gobbling up homes for any price I set on them, then I might as well build way more homes in that area because I've got a guaranteed buyer. That argument can still be overruled in the short term by pointing at the current zoning laws of many countries worldwide, and the second rebuttal is more interesting anyway: Who said anything about a 'reasonable' price? The proportionality constant between the tax levied and the listed sales price of the home is a precise instrument. We could just as easily set it to 0.1% per annum, so that people who list their homes for $1m/year still only pay $1000/year in tax and likely never see a serious purchaser, as we could set it to 10% per annum, where a $1m/year house accrues a whopping $100,000/year in Harberger taxes, which leads to people lowering the listed price, WLT many more sales and purchases, WLT considerably more housing liquidity. You could use either tactic to put the squeeze on bad actors, depending on your goals.
HDThoreaun 3y ago
This system is problematic in high inequality societies. A rich person may decide to kick you out of your home if they're feeling petty. Many people do not want to move, forcing them to sell against their will is incredibly politically unpopular.