[iamnothere]

That’s one approach, but then you get people playing with the system, adding a single apartment to the multimillion dollar lot, or the aforementioned parking lot (technically a business). The great thing about LVT is that it bypasses these shell games. The biggest weakness is that you have to fight off any attempt to seize control of the valuation process, and that is going to be difficult except in places with highly engaged and intelligent voters.

[whatever1]

That is fair. Would business zoning help in this scenario and business specific property taxes?

[iamnothere]

It might, but it’s going to be politically difficult to navigate and maintain. The tradeoff of increasingly complex rules/taxes versus a straightforward (but you have to get valuation right) method like LVT is that complex tax schemes inevitably end up with loopholes or exceptions thanks to lobbying and political connections. In the rare cases where airtight rules are passed, those are often added later as “incentives” or other dealmaking. No free lunches in politics.