http://www.zaksite.co.uk/landrent/index.html

or is this just another instance of Fair Tax?

Quote :

" What is land rent? Land rent means taxing land. Not buildings, not work, not commerce, just bare land. Or if land has buildings (as most land has) then the equivalent value of the land if it had no buildings. Land gets its value from its improvements (buildings etc) and from its location. The improvements were made by the hard work of the owners. But the location has value because of what society does, because of roads and schools and good neighbors. If society taxes buildings and improvements, it steals people’s hard work, their time and energy, their life. Most taxation is therefore theft. But if society taxes the location, then it simply claims back the value it creates. Land rent distinguishes between the individual’s property and society’s property. Why land rent matters Land rent creates fairness in the most basic of all issues: who controls the ground beneath our feet. Land rent is the only rational tax, because it is based on a sound theory of property (you create it, you own it). Land rent means an end to every other tax. So it becomes much cheaper to create additional jobs and manufacture goods. So wealth increases. Land rent is the only tax that is not a form of theft, so it encourages honesty and work. Land rent is the only way to provide enough land for everyone on earth, because it stops land speculation, so it lowers demand for land and hence the price of land goes down. In short, land rent is the simplest way to create a healthy and fair society. This benefits nearly every area of life and solves most of the world’s major problems. Land rent ensures that all land is used for maximum profit. Yet by better measuring the value of land, it preserves forest and increases the acreage of national parks, for reasons explained in the “save the world” page. The economic benefits of land rent If you tax work, the amount of work goes down, because some work becomes less profitable. But if you tax land, the amount of land remains the same. So if you want to encourage work, you should tax land, not work. Land rent is the only guarantee of fair property rights. If people can charge rent but they pay no rent themselves, eventually one person or one elite will own everything and nobody else can have any property unless it suits the elite. To see why, play the game Monopoly. Monopoly is based on "The Landlord's Game," invented by Lizzie Magie as a way to show why we need land rent. Land rent is the most efficient way of creating wealth because it gives resources to those who can use them best (that is, those who can generate the most wealth from the land). Land rent creates economic justice, by ensuring that everyone keeps the wealth they create, and any extra is given back to society. So nobody has unfair privileges, and everyone has an equal chance to succeed. Land rent provides a fair system for all, because it generates wealth for society, yet it is so simple that corruption and inefficiency have nowhere to hide. God and human equality If you believe in God, then God gave men equal rights to the land. Land rent simply charges people who stop others from using God’s land. If people are created equal, then nobody has a right to charge others for the use of land, unless they (the land owner) also pays rent to society. Most people have a gut feeling that people should cooperate and be nice to each other. A land rent system provides the basis for such a world, for the reasons given above. "

3/13/2006 11:28:05 AM

Quote :

"If you believe in God, then God gave men equal rights to the land. Land rent simply charges people who stop others from using God’s land."

lol

3/13/2006 11:32:20 AM

Quote :

"Land rent means an end to every other tax."

When has a new tax ever acted that way? New taxes supplement existing taxes, not supplant.

Quote :

"it is so simple that corruption and inefficiency have nowhere to hide."

Now you can guarantee that lawmakers will never pass it.

[Edited on March 13, 2006 at 11:43 AM. Reason : -]

3/13/2006 11:39:58 AM

Quote :

"Now you can guarantee that lawmakerslobbyists will never pass it."

3/13/2006 11:44:02 AM

An odd, but interesting, idea. However, we still have bigger problems.

That said, this idea has a real chance of getting implemented because property taxes are levied on the local level, all you need to do is convince the city council to impliment it.

That said, it would devastate the market value of undeveloped land whose property taxes will increase, with the inverse for developed land.

It would dramatically encourage the development of land, and dramatically reduce the dis-incentive to build.

Of course, if we only got as much government as we needed, it wouldn't matter how revenue was raised because the impact would be too low to encourage too much avoidance.

3/13/2006 12:34:52 PM

No less silly than the Fair Tax

3/13/2006 12:47:48 PM

The Value Added Tax is a much better tax system than both.

3/13/2006 1:10:40 PM

If you you own more land, you pay more in taxes - is this the general premise?

3/13/2006 2:10:42 PM

what happens when you build a building on some land, then can't afford to pay the land rent anymore? does the next sucker with enough for the land rent get your building?

3/13/2006 2:31:12 PM

Good question. It doesn't seem that, if you cease payin the Land Rent, you lose your buildings/improvements, because that runs counter to the original intent. But it does raise some issues. If person A takes over the "rent" on a plot of land, on which person B owns a house, and person C owns a business, what rights (if any) does that give person A to impose his will on persons B and C? That could get very messy very quickly if rights are given, but if not, then there's no point for anyone to rent the land in the first place.

3/13/2006 2:42:56 PM

^^ I assume it is just like what happens right now when you cannot afford the taxes on your property.

The city slaps you with the bill, if you do not pay it the city confiscates your property and auctions it off. Any money collected above and beyond your tax bill and attached fines you get the excess.

In the case that the taxes were on the land, but a skyscraper is sitting on it, I trust the auction would collect far more money than you owed. That said, what idiot doesn't pay his taxes to the point of losing a couple million dollars in property? Mortgate the property to the hilt. That way, if the city wants to confiscate the property it will need to fight the bank for it.

If after the auction you still owe more money on the land, then the city begins confiscating other property (car, etc). You can always declare bankruptcy and put your life in the hands of a judge.

[Edited on March 13, 2006 at 2:59 PM. Reason : ,.,]

3/13/2006 2:55:51 PM

This sounds very regressive

3/13/2006 9:59:30 PM

there is no way it could be very regressive

because last time I checked poor people typically arent sitting on hundreds of acres of land and undeveloped land in extremely rural areas still wouldnt have that much value for taxes to be levied against

but what about condos?

[Edited on March 13, 2006 at 10:53 PM. Reason : ]

3/13/2006 10:52:53 PM

the poor people that do have land dont have very valuable land
the people with very expensive land aren't poor

who is going to benefit from this more

3/13/2006 10:56:45 PM

What determines how much you pay in taxes? Is every inner-city acre taxed the same, regardless of usage? Does the fortune-500 insurance company with a skyscraper sitting on a few acres pay less than the local YMCA down the street?

3/13/2006 11:01:44 PM

^ Not if the YMCA was smart and located itself on the 3rd floor of a 50 story sky-scraper. Split the rent with 500+ other enhabitants and you should be fine.

All in all, it isn't that different from the current system. Land is taxed by what it is worth, not what is standing on it. That said, on Wall-Street in downtown NY, the land occupied by the sky-scraper can be worth more than the sky-scraper standing on it.

As it stands now, the denser the land is occupied (the more people living on it), the more you pay (A 500 apartment building is worth about 10 times as much as a 50 apartment building, keeping rents constant).

Conversely, in this proposed system, with every occupant you move in, your per-capita tax burden is diminished (holding land value constant). It is an immense push to build higher and denser downtown where most of the tax-dollars will be collected. The tax burden for the rural areas, of course, will be mixed. The rich which own large plantations will pay more. Rich suburbs with big houses on single plots will pay far less (instead of taxing a million dollar home, we are only taxing a $5,000 plot, which can be had anywhere). Middle class suburbs will pay about the same. Poor areas, of course, will still pay nothing (land in a bad area of town is still worthless, regardless of whether you are taxing abandoned buildings or drug-soaked land).

_____________Wealth
Density:____Low_____Medium_____High
Rural:______Same_____Less______Less
Suburb:____Same_____Same_____Less
Downtown:_More______More______More

This is my guess, operating under the assumption that land prices increase hockey-stick like as you get closer to downtown. anyone else have other theories?

3/14/2006 12:11:58 AM

^the land in the suburb will increase in value when the suburb is developed. So if there is a neighborhood with million dollar homes the land value there will increase, thus increasing the rent.

3/14/2006 2:20:34 AM

Quote :

"^ Not if the YMCA was smart and located itself on the 3rd floor of a 50 story sky-scraper. Split the rent with 500+ other enhabitants and you should be fine. "

Do you even know what a YMCA is?

Quote :

"As it stands now, the denser the land is occupied (the more people living on it), the more you pay (A 500 apartment building is worth about 10 times as much as a 50 apartment building, keeping rents constant). "

The "denser the land is occupied" the less people will want to pay to live there.

[Edited on March 14, 2006 at 3:10 PM. Reason : .]

3/14/2006 3:08:19 PM

Quote :

"All in all, it isn't that different from the current system. Land is taxed by what it is worth, not what is standing on it. That said, on Wall-Street in downtown NY, the land occupied by the sky-scraper can be worth more than the sky-scraper standing on it. "

I agree; this new tax would only affect properties in more suburban and rural areas. It will have much less imact on urban areas where the development on top of the land adds no real value to the land itself. I don't see how this would be of any real benefit to the United States. Maybe this is fixing some strange property tax issue in Britain...?

3/14/2006 6:14:04 PM

I WANT TO STAY AT THAT YMCA!!@

3/14/2006 6:26:18 PM

3/14/2006 7:28:32 PM

3/14/2006 9:44:07 PM

I'm glad that things started leveling off back around twenty-fifty, or there would have been trouble. Its nice to see that the well developed countries handled themselves well for so many centuries as the rest of the world messed up.

3/14/2006 9:54:57 PM

from John H. Beck .....

Quote :

"For libertarians who believe markets generally allocate resources efficiently, the best tax is one which creates the least distortion of market incentives. A tax on the value of land meets this criterion. Furthermore, the benefits of local government services will be reflected in the value of land within the locality. Therefore, it may be deemed fair that landowners pay taxes to finance these services in proportion to the value of the benefits they receive. Although Henry George advocated a tax on land values as the "single tax" to replace all other taxes, a tax on land value seems especially appropriate for municipal governments. If a complete shift from the current property tax to a tax on land value alone seems too radical, municipal governments might reduce the property tax rate on improvements while imposing a higher tax rate on the value of land. "

Although I support the FairTax, a tax on land value would still be preferable over the current horrendous income tax system.

3/14/2006 10:33:30 PM

^ Wait, this wasn't a substitute to the current property tax system?!?!? WTF?!?

You CANNOT raise 20+% GDP by taxing property! That is absurd! It would utterly and completely destabilize the "natural market system" for realestate.

Rents, ownership costs, would sky-rocket. As a result, everyone will abandon the ownership of land, opting instead for government housing (exempt) or squating. The system will go into a spiral of destruction as people default on their "land taxes", opting instead for illegal housing, driving down land values and tax collection, prompting higher tax rates, pushing people off property, etc.

Eventually the system would settle when the government fixed land prices for the purpose of tax collection (stopping the fall), but it would look nothing like the current system. People will sometimes pay you to take un-occupied land off their hands. The price of a house+plot will sometimes be less than the price of constructing the house because you are not just selling property, but an obligation to pay a third party cash every month. So, the real price of real-estate will be the land value + asset value - [present value of all future tax payments].

Ultimately, people will on average be paying about the same in taxes every year, but land ownership will by much lower and illegal housing and businesses will be booming, as is the result whenever you tax something by a rediculous amount (60+%).

3/14/2006 11:16:04 PM

Quote :

"The "denser the land is occupied" the less people will want to pay to live there."

commercial land is valued at more than residential land. It's not aboutt whether or not people want to live there, although that does play a role, but rather what people are willing to pay for the land. Urban land is by far more expensive than rural land.

3/15/2006 1:25:52 AM

Thats true, but his example was residential

3/16/2006 9:46:23 AM

how about not taxing stuff repeatedly that people have already worked and paid for.

3/16/2006 9:49:05 PM

How about just not taxing people

3/16/2006 10:54:11 PM

no this is stupid. In fact this is one of the worst ideas I've ever seen. The amount of infrastructure needed and INSANE amount of loopholes right off the bat for corruption make this not possible. Let me explain.

First... not only would you have to set a lands initial value, but then you would have to get someone who represents the official view of land values to reevaluate your land and its improvements. Right there... huge huge HUGE hole for corruption.

Lets say you are a apartment building owner, you pay more for the large/higher complex you own. toss $1000 to the inspector and your land pays "less" tax because it's considered smaller.

Or lets say some building corp wants your land. They pay off one of these inspectors to greatly overevaluate your land.

Our tax system is fine. The problem is that our taxes don't go where they are supposed to. I want their to be legislation that says money obtained for transportation (roads and highways) does not go elsewhere. It is spent on roads and highways.

Thats my problem with our current system.

3/16/2006 11:48:55 PM

Uh, we already have a property tax system. It is something along 10 cents for every 100 dollars. Changing it from a property tax to a land tax would not dramatically change the incentives to cheat nor would the effects have more than marginal impact.

If you are saying the system would collapse if it went from collecting about 5% GDP to 40+% GDP, you'd be right. Trying to scap the income tax system and replacing it with a land tax would be insane by warping the market substantially.

That said, the income tax system itself has been corrupt from day one. It would be negligible if government was smaller, but it doesn't appear to be going that way. Income tax evasion, by itself, is a huge money maker. It doesn't tax criminals, it doesn't tax liers, it doesn't tax illegals. A "land tax" would at least do this. No amount of bribery could value your land at zero. But lie on just one form and you can get your income valued at zero. Hell, some mafia bosses qualify for the Earned Income Tax Credit (Their tax rate is effectively negative!) Try finding such glaring holes in any other means of taxation than income.

A well worded Value Added Tax would be impossible to avoid entirely. Even if my factory manages to escape paying the tax directly, odds are my suppliers didn't, and whenever I spend my ill-gotten profits I'll pay it then.

3/17/2006 10:16:46 AM

.10 on the hundred? in my county it is .84. .20 goes to medicaid and that is constantly increasing.

3/17/2006 9:11:21 PM