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by tps5
3344 days ago
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It's not a horrible idea. It's an old idea that's been popular with various economists including (gasp) Adam Smith: https://en.wikipedia.org/wiki/Land_value_tax (I don't know enough about this subject to have a strong opinion either way, but I feel pretty confident saying that this isn't a terrible idea) |
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It is, for a wide array of reasons. Assessment for ad valorem, as-is, taxation of land is highly contentious as it is, but there is at least some coherent basis for such assessment since there are usually reasonably comparable referents involved in actual marker trade on which to base an assessment.
LVT inherently relies on assessment of the unimproved value of improved lots, which means you need to assess something for which there will rarely be comparable examples in trade. That's a practical concern.
There's a deeper theoretical concern that the fundamental basis of LVT (that land in the conventional sense represents the ultimate source of all extractions from the commons, such that an LVT represents a generalized tax on the use of the commons) is fundamentally flawed. While land holding can be viewed as a kind of use of the commons which should be taxed, wealth more generally itself (and moreso the farther that wealth is beyond that which one could personally supervise with one's inherent bodily facilities) represents such a use in any system with public enforcement of property rights, as do resource extraction and pollution generation.
> It's an old idea that's been popular with various economists including (gasp) Adam Smith
Adam Smith also thought that the landholding class was inherently the only class that could be trusted with government, since the business-owning class (Smith wrote early enough in the feudalism-capitalism transition that the fact that the latter class would subsume the former was not obvious to him) would favor interests that were distinct from the common interest, while the working class, which like the land-holding class would have interests aligned with the common interest -- would inherently be too ill-informed to understand or politically pursue their own interest.
Smith is an important and often insightful figure in the history of political economy, but, especially when it comes to the relationship of land-holding to capitalist and post-capitalist economies, not exactly a source where "he thought X was a good idea" is a particularly strong endorsement.