[davidw]

> Nobody walks past a vacant block in a prime real estate location

Vacant blocks in prime real estate locations are taxed at their market value though, no? So if you've got that land sitting idle, and you're not collecting income from rent, nor using it yourself, you're going to lose money on it. This is an incentive to sell it to someone who will make money, or otherwise find a way to employ it more productively.

That said, I don't think I'd really like to see property taxes on domain names.

[RyanMcGreal]

Unfortunately, in most property tax systems your tax rate is a function of what you've built on it, e.g. surface parking earns less than a tall mixed use building but incurs proportionately less property tax.

[thenbrent]

At first I liked the idea of market value based taxes and clearly a bunch of HN readers agree with the idea.

The biggest issue I see though is the implication for small projects.

For example, maybe in 1994 you snapped up pizza.com. You could have been using it ever since for a pizza price search engine which gets 100,000 unique visitors per month and earns you $5,000 per month. That's decent income, except the taxes on the domain's market value of $2.6 million[1] would be crippling. So despite using the domain in what most would think of as good way, you couldn't afford to have such a good domain. Now extrapolate this example for the thousands of sites that have a good domain name for a small project.

[1] http://news.cnet.com/8301-10784_3-9912380-7.html

[davidw]

Yeah, like I said, I ultimately don't think it's a good idea: it would add too much friction for the benefits.