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> If you tax someone with 5 bucks in their bank account and no job, 10% of their 200K property, they arent going to accrue 90% of their property on an ongoing b
by orthoxerox 1y ago
> If you tax someone with 5 bucks in their bank account and no job, 10% of their 200K property, they arent going to accrue 90% of their property on an ongoing basis. Their wealth will shrink. Which is bad on average.
Again, that's the whole idea behind LVT: it minimizes non-productive use of land, like housing.
- eru 1y agoNo, LVT does not minimise non-productive use of land at all. I like LVT just as much as the next guy, but we can't have it both ways: _either_ LVT has no deadweight losses, because it doesn't change any opportunity costs for land use and thus has no (direct) influence on land use. _Or_ LVT does have an influence, and you want to argue that it's the 'correct' one. However: with or without LVT, the opportunity cost differences in different land uses are exactly the same. The same amount of LVT is due no matter what you do with the land or who owns it. LVT might have an indirect influence on land use, because financing your government via LVT means you can potentially lower other less efficient taxes. Removing these other more distorting taxes can have an influence on land uses.
- sokoloff 1y agoI am having a hard time understanding your last sentence. How is housing a non-productive use of land? Why would housing be something to be minimized?
- eru 1y agoThey probably means something like some poor single person sitting on a very valuable plot of land and not doing much with it. Maybe? I'm not exactly sure. But see my reply at https://news.ycombinator.com/item?id=44189482 https://news.ycombinator.com/item?id=44189482