4 ms·

Because their tenant can just go down the street and rent from another landlord whose costs did not increase by $10-20K/yr. In a world where LVTs increased tax

Because their tenant can just go down the street and rent from another landlord whose costs did not increase by $10-20K/yr. In a world where LVTs increased taxes on all nearby landlords, that threat is an empty one. Sure, they can threaten to go move 10 miles away or eventually to go move into a beehive apartment that will be built 3 years from now to optimally house humans while not leaving a shred of land under-used.

eru 1y ago
> Because their tenant can just go down the street and rent from another landlord whose costs did not increase by $10-20K/yr. Well, that only works iff landlords can pass down these taxes. That's exactly what we are discussing. So this is begging the question. > In a world where LVTs increased taxes on all nearby landlords, that threat is an empty one. [...] It doesn't matter. Even if only left-handed landlords paid LVT, rents wouldn't change depending on the handedness of your landlord. (However, left-handed landlords would likely sell to righthanded landlords, because the property is worth more to them.)
- sokoloff 1y ago
  It is not begging the question to identify that a key economic factor would change under an LVT to be different from today. This change would affect the number of landlords who could profitably offer units for rent at today’s prices, which I posit would affect their willingness to supply units at that price, shifting their supply curve. Your own observation that rents would not change based on handedness of your landlord implies that you understand this.
  - eru 1y ago
    The supply of land is fixed. (You can change the supply of land on the market, by eg giving a tax subsidy for keeping land off the market. That's what the British council tax does in many counties: you get a rebate, if your property ain't occupied. But LVT specifically does not depend on what you do with the property. It's due one way or another, thus it has no influence on the supply of land.)
    - sokoloff 1y ago
      In 2025, a certain supply of units is available for rent in some relevant market. In 2026 an LVT is enacted shifting taxes onto land owners (and away from income earners). Do you expect rents at the end of 2026 to be higher or lower than now in that market?
      - eru 1y ago
        In your scenario, we are enacting an LVT and lowering some other tax (say, income taxes). The LVT itself will have no impact on rents. However, lowering income taxes will increase rents, independent of LVT. (Eg if they'd just lowered income taxes, because some rich sheikh wrote the government a big check for fun.) That's assuming all else being equal, eg number of units available for rent.
        protocolture 1y ago
        >The LVT itself will have no impact on rents. Any tax levied on landlords will impact rents. Any business where the input costs increase, has an effect on prices. If you have a heck of a lot of competition AND the businesses can eat the increase you might get away with it. But LVT is a regressive tax that doesnt care about income, so the "businesses" aka landlords in this scenario can (and probably will) have tax that reduces their income to a deficit. Theres no getting around this, you need to stop pretending that LVT is magic.
        sokoloff 1y ago
        "Landlords will just eat the LVT" makes as much sense as "China will pay the tariffs".
        eru 1y ago
        Why do you care so much about 'regressive'? Yes, only an income tax cares about your income. Eg a capital gains tax also doesn't care about your income. So you are also arguing conversely that giving landowners some free gifts will lead to a drop in rents? Colour me skeptical. Prices are set by demand and supply. For a cost to be passed on, supply must shrink. There's nothing in the LVT that would cause supply to shrink.

eru 1y ago

> Because their tenant can just go down the street and rent from another landlord whose costs did not increase by $10-20K/yr. Well, that only works iff landlords can pass down these taxes. That's exactly what we are discussing. So this is begging the question. > In a world where LVTs increased taxes on all nearby landlords, that threat is an empty one. [...] It doesn't matter. Even if only left-handed landlords paid LVT, rents wouldn't change depending on the handedness of your landlord. (However, left-handed landlords would likely sell to righthanded landlords, because the property is worth more to them.)

sokoloff 1y ago
It is not begging the question to identify that a key economic factor would change under an LVT to be different from today. This change would affect the number of landlords who could profitably offer units for rent at today’s prices, which I posit would affect their willingness to supply units at that price, shifting their supply curve. Your own observation that rents would not change based on handedness of your landlord implies that you understand this.
- eru 1y ago
  The supply of land is fixed. (You can change the supply of land on the market, by eg giving a tax subsidy for keeping land off the market. That's what the British council tax does in many counties: you get a rebate, if your property ain't occupied. But LVT specifically does not depend on what you do with the property. It's due one way or another, thus it has no influence on the supply of land.)
  - sokoloff 1y ago
    In 2025, a certain supply of units is available for rent in some relevant market. In 2026 an LVT is enacted shifting taxes onto land owners (and away from income earners). Do you expect rents at the end of 2026 to be higher or lower than now in that market?
    - eru 1y ago
      In your scenario, we are enacting an LVT and lowering some other tax (say, income taxes). The LVT itself will have no impact on rents. However, lowering income taxes will increase rents, independent of LVT. (Eg if they'd just lowered income taxes, because some rich sheikh wrote the government a big check for fun.) That's assuming all else being equal, eg number of units available for rent.
      - protocolture 1y ago
        >The LVT itself will have no impact on rents. Any tax levied on landlords will impact rents. Any business where the input costs increase, has an effect on prices. If you have a heck of a lot of competition AND the businesses can eat the increase you might get away with it. But LVT is a regressive tax that doesnt care about income, so the "businesses" aka landlords in this scenario can (and probably will) have tax that reduces their income to a deficit. Theres no getting around this, you need to stop pretending that LVT is magic.
        sokoloff 1y ago
        "Landlords will just eat the LVT" makes as much sense as "China will pay the tariffs".
        eru 1y ago
        Why do you care so much about 'regressive'? Yes, only an income tax cares about your income. Eg a capital gains tax also doesn't care about your income. So you are also arguing conversely that giving landowners some free gifts will lead to a drop in rents? Colour me skeptical. Prices are set by demand and supply. For a cost to be passed on, supply must shrink. There's nothing in the LVT that would cause supply to shrink.