• This is a political forum that is non-biased/non-partisan and treats every persons position on topics equally. This debate forum is not aligned to any political party. In today's politics, many ideas are split between and even within all the political parties. Often we find ourselves agreeing on one platform but some topics break our mold. We are here to discuss them in a civil political debate. If this is your first visit to our political forums, be sure to check out the RULES. Registering for debate politics is necessary before posting. Register today to participate - it's free!

Land value tax

joko104

On Vacation
DP Veteran
Joined
Jan 21, 2009
Messages
57,017
Reaction score
20,606
Gender
Undisclosed
Political Leaning
Undisclosed
The fact that we don't pay tax for air yet is a big flaw of private market economy.
That is a perfectly contradictory sentence. If the private sector did own the air then the government would tax it.
 

Ringo Stalin

Well-known member
Joined
Dec 18, 2019
Messages
2,132
Reaction score
286
Gender
Male
Political Leaning
Communist
That is a perfectly contradictory sentence. If the private sector did own the air then the government would tax it.
Even if the government did not tax air, we would still have to pay for its use by private companies. I wonder how users could choose the best and most effective company?... The only way I see it, individually wearable devices filled with air. Very convenient, since we could choose the best company and enjoy the benefits of capitalist competition. I hope I live to see this happy moment and breathe the pure air of freedom!
 

Geoist

Supporting Member
DP Veteran
Joined
Aug 14, 2012
Messages
16,595
Reaction score
8,234
Gender
Male
Political Leaning
Libertarian - Left
The fact that we don't pay tax for air yet is a big flaw of private market economy. If the air were in private hands, it would be much cleaner, fresher and more fragrant, and competition would lead to prices that would be quite moderate and affordable for the majority of the population.
P.S. I think I deserve next Nobel price in the field of economy.
Ever seen Total Recall?

NSFW language:
 

Waddy

DP Veteran
Joined
Jan 21, 2017
Messages
6,834
Reaction score
1,797
Gender
Male
Political Leaning
Moderate
In the 19th century, there was an economic philosophy known as Georgism (or Geoism). To sum it up, they believe in socialism for land and capitalism for everything else. The logic is that while people can produce many stuff with their labor, they did not produce the land. Thus by paying a land value tax, they would be paying rent to mother nature. Georgists use this to argue that there should be a tax on land and that it should be the only tax. The movement died out after the early 20th century and very few jurisdictions ended up embracing this kind of tax.


A land value tax is a tax on land value. It differs from property taxes in that it only taxes the value of land, not anything built on it. I'm somewhat doubtful that this tax could collect enough revenue to replace everything else but it could have positive results. With the revenue collected, it could help reduce fiscal deficits, increase spending, or lower existing taxes. LVT would be progressive in nature because rich people tend to own more total land value with multiple houses and because poor people are more likely to rent. It would also discourage land speculation and instead encourage the efficient use of land. It's also less susceptible to tax evasion because of the full transparency of land value as opposed to personal or corporate income tax. The one issue I see is the potential negative effect on people who are land rich but cash poor such as on independent farmers and on people living in expensive cities (the cost being passed down as increased rent).

You may remember me posting about the consumption tax. A bunch of people pointed out that luxury goods tend to have elastic demand and that rich people would simply cheat the system by importing such goods. This is actually what happened in the early 90s when such as tax was implemented in the US; revenue turned out to be lower than expected. LVT doesn't have this problem because it cannot be moved and because it's not a commodity which is subject to supply and demand.
So a land tax would be the ONLY tax? Wouldn't that be a great incentive for government to open almost all public lands to productive enterprises? The more land the government rents out the more they collect. Be careful what you wish for.
 

Geoist

Supporting Member
DP Veteran
Joined
Aug 14, 2012
Messages
16,595
Reaction score
8,234
Gender
Male
Political Leaning
Libertarian - Left
So a land tax would be the ONLY tax? Wouldn't that be a great incentive for government to open almost all public lands to productive enterprises? The more land the government rents out the more they collect. Be careful what you wish for.
The most valuable lands on the globe, the lands which yield the highest rent, are not lands of surpassing natural fertility, but lands to which a surpassing utility has been given by the increase of population. - Henry George

Vast majority of tax would come in from highly-populated areas. The incentive to open up public lands would be practically non-existent, especially considering the political backlash from environmentalists and anyone who loves a park.
 

iguanaman

DP Veteran
Joined
Dec 16, 2011
Messages
43,638
Reaction score
14,726
Location
Florida
Gender
Male
Political Leaning
Liberal
In the 19th century, there was an economic philosophy known as Georgism (or Geoism). To sum it up, they believe in socialism for land and capitalism for everything else. The logic is that while people can produce many stuff with their labor, they did not produce the land. Thus by paying a land value tax, they would be paying rent to mother nature. Georgists use this to argue that there should be a tax on land and that it should be the only tax. The movement died out after the early 20th century and very few jurisdictions ended up embracing this kind of tax.


A land value tax is a tax on land value. It differs from property taxes in that it only taxes the value of land, not anything built on it. I'm somewhat doubtful that this tax could collect enough revenue to replace everything else but it could have positive results. With the revenue collected, it could help reduce fiscal deficits, increase spending, or lower existing taxes. LVT would be progressive in nature because rich people tend to own more total land value with multiple houses and because poor people are more likely to rent. It would also discourage land speculation and instead encourage the efficient use of land. It's also less susceptible to tax evasion because of the full transparency of land value as opposed to personal or corporate income tax. The one issue I see is the potential negative effect on people who are land rich but cash poor such as on independent farmers and on people living in expensive cities (the cost being passed down as increased rent).

You may remember me posting about the consumption tax. A bunch of people pointed out that luxury goods tend to have elastic demand and that rich people would simply cheat the system by importing such goods. This is actually what happened in the early 90s when such as tax was implemented in the US; revenue turned out to be lower than expected. LVT doesn't have this problem because it cannot be moved and because it's not a commodity which is subject to supply and demand.
I bet the farmers will not like this plan...
 

Waddy

DP Veteran
Joined
Jan 21, 2017
Messages
6,834
Reaction score
1,797
Gender
Male
Political Leaning
Moderate
The most valuable lands on the globe, the lands which yield the highest rent, are not lands of surpassing natural fertility, but lands to which a surpassing utility has been given by the increase of population. - Henry George

Vast majority of tax would come in from highly-populated areas. The incentive to open up public lands would be practically non-existent, especially considering the political backlash from environmentalists and anyone who loves a park.
So basically tax the shit out of places like New York and San Francisco and let everyone else off the hook...... I'm all for it !!!!!
 

Geoist

Supporting Member
DP Veteran
Joined
Aug 14, 2012
Messages
16,595
Reaction score
8,234
Gender
Male
Political Leaning
Libertarian - Left
I bet the farmers will not like this plan...
Farmers should like this plan. It would untax their barns, homes, stables, storage sheds, etc. Rural land is far cheaper than urban/suburban land.
 

Waddy

DP Veteran
Joined
Jan 21, 2017
Messages
6,834
Reaction score
1,797
Gender
Male
Political Leaning
Moderate
I bet the farmers will not like this plan...
They won't be effected. He said primarily heavily populated areas would pay that tax. Sounds like a great idea. And the oil and gas corporations will be glad to have those pesky royalties they pay for government leases eliminated.
 

Geoist

Supporting Member
DP Veteran
Joined
Aug 14, 2012
Messages
16,595
Reaction score
8,234
Gender
Male
Political Leaning
Libertarian - Left
So basically tax the shit out of places like New York and San Francisco and let everyone else off the hook...... I'm all for it !!!!!
Lol, well they're already in tax hell, but the beauty of it, to me, is how it would discourage the speculative behavior that leads to vacant urban land and rampant urban sprawl.
 

Geoist

Supporting Member
DP Veteran
Joined
Aug 14, 2012
Messages
16,595
Reaction score
8,234
Gender
Male
Political Leaning
Libertarian - Left
They won't be effected. He said primarily heavily populated areas would pay that tax. Sounds like a great idea. And the oil and gas corporations will be glad to have those pesky royalties they pay for government leases eliminated.
Resource extraction would still be taxable under LVT. But instead of government projects I'd advocate for a dividend similar to what Alaskans get for their oil.
 

OrphanSlug

A sinister place...
Supporting Member
DP Veteran
Joined
Sep 24, 2011
Messages
21,071
Reaction score
18,590
Location
Atlanta
Gender
Male
Political Leaning
Independent
In the 19th century, there was an economic philosophy known as Georgism (or Geoism). To sum it up...
To really sum this up, the idea was dismissed a very long time ago as the tax method suffers from seriously fatal thinking.

At a high level the concept creates such an economic distortion in that you disincentivize investment in land and you also disincentivize finding better uses of land, as the tax itself does not and cannot care about economic condition. A considerable level of wealth in this nation is tied to either investment in land or investment in industry, with this tax method you harm the former with terrible implications for the latter. Industry and even innovation needs land investment, and you geniuses kill that off with the stroke of a pen. You simply cannot manipulate the math fast enough under those tax principles to deal with changing economic conditions, and even if you tried you further disincentivize consideration for how land is used no matter the economic condition.

All you create is reaction to that tax with zero consideration for why, and that is economically suicidal.

But the even bigger issue here is that in all modern economics taxation is not exclusively about government funding. In all modern economics spending reason is first, taxation reason is second. You have to consider all the principles of fiscal policy (complemented by monetary policy) to deal with any aggregate demand condition. Georgism does not care about these things nor can it.

To prevent a bubble that means taxes should go up and government spending should go down to stabilize long term growth lines, there is less sound reason to run deficits in that condition, and the emphasis is on private investment and consumer spending being in larger control. Again, Georgism does not care about these things nor can it.

To prevent the next crash that means taxes should go down and government spending should go way up as a means to deal with whatever aggregate demand fault is occurring at the time. Deficits have to go up as a matter of all principles of stimulus. Something has caused private investment and consumer spending to take a dive and the one entity left in the equation, the federal government, has to do something about that condition. Tax policy and spending ends up one off, with specified targets to deal with that aggregate demand fault. And yet again, Georgism does not care about these things either nor can it.

There is no practical reason, no basis in economic thinking, to go with Georgism. It is almost elementary room chalkboard thinking to consider the idea.
 

Waddy

DP Veteran
Joined
Jan 21, 2017
Messages
6,834
Reaction score
1,797
Gender
Male
Political Leaning
Moderate
Lol, well they're already in tax hell, but the beauty of it, to me, is how it would discourage the speculative behavior that leads to vacant urban land and rampant urban sprawl.
Maybe it would encourage people o leave the big cities. That might mean more urban sprawl.
 

Waddy

DP Veteran
Joined
Jan 21, 2017
Messages
6,834
Reaction score
1,797
Gender
Male
Political Leaning
Moderate
Resource extraction would still be taxable under LVT. But instead of government projects I'd advocate for a dividend similar to what Alaskans get for their oil.
You really think the government would voluntarily give up those revenues? I really doubt it.
 

iguanaman

DP Veteran
Joined
Dec 16, 2011
Messages
43,638
Reaction score
14,726
Location
Florida
Gender
Male
Political Leaning
Liberal
Farmers should like this plan. It would untax their barns, homes, stables, storage sheds, etc. Rural land is far cheaper than urban/suburban land.
State and local Govts. get most of their money from real estate taxes already I don't see them giving that up. Income taxes are here to stay.
 

skeptic llc

Supporting Member
Joined
Sep 7, 2020
Messages
1,446
Reaction score
532
Location
PNW USA
Gender
Male
Political Leaning
Other
So basically tax the shit out of places like New York and San Francisco and let everyone else off the hook...... I'm all for it !!!!!
Sounds like the system we have now.
 

Waddy

DP Veteran
Joined
Jan 21, 2017
Messages
6,834
Reaction score
1,797
Gender
Male
Political Leaning
Moderate
State and local Govts. get most of their money from real estate taxes already I don't see them giving that up. Income taxes are here to stay.
I also think income taxes are here to stay, but for a different reason. The income tax gives government an unprecedented look at all your personal finances; how you make your money, where you make it, how much debt you have, what kind of debt, your investments, where you invest, your marital status, children, etc. ALL of your most personal information. I don't see them giving that up.
 

skeptic llc

Supporting Member
Joined
Sep 7, 2020
Messages
1,446
Reaction score
532
Location
PNW USA
Gender
Male
Political Leaning
Other
You do realize it's Democrats doing most of that taxing? :)
"Most" of the taxing is done by the federal government, currently an R operation, and operates as a big wealth transfer vehicle from economically successful (i.e., blue) states to impoverished (i.e., red) states. But I do realize the state-level Ds make things much, much worse. Is that the question?
 

calamity

Privileged
Supporting Member
Monthly Subscriber
DP Veteran
Joined
Feb 12, 2013
Messages
130,564
Reaction score
39,078
Gender
Undisclosed
Political Leaning
Centrist
In the 19th century, there was an economic philosophy known as Georgism (or Geoism). To sum it up, they believe in socialism for land and capitalism for everything else. The logic is that while people can produce many stuff with their labor, they did not produce the land. Thus by paying a land value tax, they would be paying rent to mother nature. Georgists use this to argue that there should be a tax on land and that it should be the only tax. The movement died out after the early 20th century and very few jurisdictions ended up embracing this kind of tax.


A land value tax is a tax on land value. It differs from property taxes in that it only taxes the value of land, not anything built on it. I'm somewhat doubtful that this tax could collect enough revenue to replace everything else but it could have positive results. With the revenue collected, it could help reduce fiscal deficits, increase spending, or lower existing taxes. LVT would be progressive in nature because rich people tend to own more total land value with multiple houses and because poor people are more likely to rent. It would also discourage land speculation and instead encourage the efficient use of land. It's also less susceptible to tax evasion because of the full transparency of land value as opposed to personal or corporate income tax. The one issue I see is the potential negative effect on people who are land rich but cash poor such as on independent farmers and on people living in expensive cities (the cost being passed down as increased rent).

You may remember me posting about the consumption tax. A bunch of people pointed out that luxury goods tend to have elastic demand and that rich people would simply cheat the system by importing such goods. This is actually what happened in the early 90s when such as tax was implemented in the US; revenue turned out to be lower than expected. LVT doesn't have this problem because it cannot be moved and because it's not a commodity which is subject to supply and demand.
I'm not sure why the US adopted the principle to ignore the rights of the masses when it came to allowing privateers to exploit the public commons.
 

Waddy

DP Veteran
Joined
Jan 21, 2017
Messages
6,834
Reaction score
1,797
Gender
Male
Political Leaning
Moderate
"Most" of the taxing is done by the federal government, currently an R operation, and operates as a big wealth transfer vehicle from economically successful (i.e., blue) states to impoverished (i.e., red) states. But I do realize the state-level Ds make things much, much worse. Is that the question?
From what I've seen, the IRS taxes everybody at their rate, regardless of where they reside. It's the state and local taxes that vary so much. That there answers the question. :)
 

Geoist

Supporting Member
DP Veteran
Joined
Aug 14, 2012
Messages
16,595
Reaction score
8,234
Gender
Male
Political Leaning
Libertarian - Left
State and local Govts. get most of their money from real estate taxes already I don't see them giving that up. Income taxes are here to stay.
No one is saying state and local governments need to give up tax revenue. The transition can be done in a way that is revenue neutral. The goal is to unburden productivity and put a bigger burden on the unproductive speculation causing sprawl and artificially raising rent. You are probably right the income tax is likely here to stay in most states. But I do think there is room for conversation for alternatives.
 

Geoist

Supporting Member
DP Veteran
Joined
Aug 14, 2012
Messages
16,595
Reaction score
8,234
Gender
Male
Political Leaning
Libertarian - Left
Maybe it would encourage people o leave the big cities. That might mean more urban sprawl.
There would still be sprawl due to population increase, just not to the extent we see it today. NYC, alone, has over 22 square miles of vacant land. Imagine how many people can live within those 22 square miles. Imagine how many businesses can be set up within that space. Our current tax system encourages poor land use which leads to more sprawl.
 

Geoist

Supporting Member
DP Veteran
Joined
Aug 14, 2012
Messages
16,595
Reaction score
8,234
Gender
Male
Political Leaning
Libertarian - Left
You really think the government would voluntarily give up those revenues? I really doubt it.
They wouldn't be 'giving up' on revenues, simply reallocating the funds and 'investing' in the citizens. The Alaska Permanent Fund is wildly popular. Any smart politician would advocate a similar dividend towards its state's resources/land.
 

Geoist

Supporting Member
DP Veteran
Joined
Aug 14, 2012
Messages
16,595
Reaction score
8,234
Gender
Male
Political Leaning
Libertarian - Left
To prevent a bubble that means taxes should go up and government spending should go down to stabilize long term growth lines, there is less sound reason to run deficits in that condition, and the emphasis is on private investment and consumer spending being in larger control. Again, Georgism does not care about these things nor can it.
Georgism is a preventative measure against bubbles. Our current economic system allows the rampant land speculation we see over and over again.
 
Top Bottom