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LVT doesn't encourage infinite development on all land - it encourages the efficient use of land. If you replaced property taxes with land value taxes and held
by rrrrrrrrrrrryan 3y ago
LVT doesn't encourage infinite development on all land - it encourages the efficient use of land.
If you replaced property taxes with land value taxes and held revenue equal:
For rural areas, not much would change. Land is cheap and taxes would remain low.
For suburban areas, there would be a moderate shift in tax burden. People with homes on large plots of land would pay more; people with homes on smaller plots of land would pay less.
For urban areas, the changes would be drastic. Because land is limited in urban cores and appreciates in value every year, there's an absurd amount of speculation. An LVT would discourage this by making it costly to hold onto undeveloped or underdeveloped land just for future price gains. As a result, we could expect a surge in the development of vacant or underutilized plots, leading to a potential increase in housing availability and a decrease in rental prices. This would both alleviate housing shortages and reduce the speculative bubbles that can distort urban real estate markets.
- oneshtein 3y agoWith %100 LVT, city will be owner of most land in 1 year. With 10% LVT - in 10 years. Value based tax means that value is transferred from owner to a new owner no matter what. Owner is just working for a new owner.
- strken 3y agoFrom memory, the Georgist belief is that whoever collects the tax will spend it, and the spending will distribute the value in a way which is...not necessarily equal, but is closer to equality than the status quo was. The wealth transfer is a feature rather than a bug, in this case. Speculators sitting on unimproved or underutilised land are seen as literal rent-seekers, and taxing them is seen as reclaiming a natural monopoly at the same time as removing the leeches who're sucking up big chunks of a city's growth.
- developer93 3y agoThat applies to any kind of work currently also..
- mactrey 3y agoWell, property taxes in my city are around 1% currently. Does that mean the city will own 100% of land in 100 years? Probably not. For lots of reasons.