Talk:Land value tax/Archive 1

Archive 1

Archive 2

Pros and Cons

If it's so good, why is it used in so few places? To put it another way, I imagine there must be arguments that are used to argue against its introduction. Right or wrong, they must belong in this article to give it a neutral point of view... or did I miss something? Notinasnaid 07:21, 27 Aug 2004 (UTC)

The main reason that it's not in more widespread use is that it shifts the burden of taxes from the general population to the landowning fraction. They are aware that while it is easy to avoid many other kinds of tax by accounting methods, it is very difficult to avoid Land tax unless one sells the land. Since land is a very stable asset and since rents can be a very lucrative source of income, they are unwilling to do so. Generally these are legislators, or at the least, well connected people who are able to effectively lobby against its introduction. In Britain, for instance, I believe that this has happened twice. In the early 1900s the landowners of the House of Lords induced a constitutional crisis over a budget which contained Land Tax proposals. That episode led to reform of the House of Lords but achieved its aim of suppressing the tax. In the late 1930s, a second attempt to pass Land Tax legislation was successful and I am fairly sure that the legislation remains on the statute books. However the regulations to put it into action have never been issued and so to all intents and purposes the legislation might as well not exist. I can only speculate as to the reasons. -- Derek Ross | Talk 15:01, 27 August 2004 (UTC)

Interesting. But surely there are arguments against (specious or otherwise) that are regularly produced against it, and these belong in a balanced discussion? (I can think of some, but I am not an economist, so I'd rather not originate them for what should be a research article. (I could question, for instance, why a struggling farmer should pay more tax, while a successful software developer living in a one bedroom flat should pay less. But I have no idea if this is a commonly advanced argument, or how the LVT advocates would respond). Notinasnaid 17:52, 27 Aug 2004 (UTC)

Funny you should say that. It is indeed a commonly advanced argument by the opponents of LVT. In fact that very argument was used in the 1920s to remove taxation from agricultural land in Britain. The proponents of the measure stated that removing rates (a form of Land-based taxes) from agricultural land would help small and struggling farmers by reducing their overheads. This sounds reasonable and the measure was passed. However it did not act as stated; in fact it had a bad effect on the farmers concerned, most of whom are tenant farmers. The small tenant farmers saw their rents rise to absorb the money which used to be taken in taxation. They also saw the price of freehold farmland rising because of the greater profits which could now be made by renting land to farmers and were thus even less able to buy their own land than before. The only beneficiaries of the change in taxation were the landowners which is precisely what anyone would expect of this type of change.

The small farmer thing is a bit of red herring though, since rural land is generally low value compared to urban land and thus LVT on it would be low too unless you owned a lot in which case you would not be a small farmer. The biggest slice of LVT would be expected to come from the highly desirable land in the centre of cities rather than from the vast swathes outside it. Small shopkeepers in the city centre are a much bigger target for LVT than small farmers because of the high value of plots in city centres. However a small shopkeeper is almost invariably a tenant too, so raising or lowering LVT will have the same effect for them as for small farmers; ie as their LVT goes up, their rents will fall to fill the gap and vice-versa.

As to why successful software developers in one bedroom flats should be particularly favoured, it could be argued that such a person is being highly productive and yet very efficient in their use of economic resources. Practically all of their output is due to their own efforts and very little due to the natural productivity of the land, so why should they be taxed ? On the other hand the output of a landlord is buildings (and maintenance of them if the tenant has a good lease) but not the land on which the buildings are built, so they are relatively inefficient in terms of economic production. -- Derek Ross | Talk 23:03, 2004 Aug 27 (UTC)

I think this demonstrates my original point - the article as it is written is does not reflect a neutral point of view (NPOV), because it does not present any of the common arguments against. Notinasnaid 08:20, 28 Aug 2004 (UTC)

Understood. I'll try to add them then. However it is difficult for me as a proponent of LVT to add arguments against without rebutting them (since I consider most of them to be specious). I'll see what I can do though. -- Derek Ross | Talk 18:23, 2004 Aug 28 (UTC)

Honestly, I've never seen a criticism of the LVT which didn't show a gross misunderstanding of what it is or what it does. But oh well. Criticism is criticism. I believe I remember something about Murray Rothbard writing a rebuttal of the LVT. I don't have the link to it, but the Geolibertarian FAQ addresses some of his points and gives a good counter-rebuttal. --Paradigm 14:30, 5 Apr 2005 (UTC)

Marx's criticism of land tax (as anything more than one of the measures to be imposed during the move to communism) was relatively influential - he argues that "The whole thing is...simply an attempt, decked out with socialism, to save capitalist domination and indeed to establish it afresh on an even wider basis than its present one." He also opposes the way that land value tax emphasises the value of land - arguing that "Theoretically the man [Henry George] is utterly backward! He understands nothing about the nature of surplus value and so wanders about in speculations which follow the English model but have now been superseded even among the English, about the different portions of surplus value to which independent existence is attributed--about the relations of profit, rent, interest, etc. His fundamental dogma is that everything would be all right if ground rent were paid to the state." See Marx's letter at [1] Marx's critique would probably be worth mentioning here. Jon 00:24, 4 March 2006 (UTC)

I too am an advocate of LVT, but the article seems to me to fail NPOV. Criticisms are bracketed by advocacy and rebuttal, there are citations missing for some claims, and the language used is definitely not neutral. Can anyone help with a re-write? Fatfingers 02:46, 4 August 2006 (UTC)

I don't see the potential for much (if any) salvage on the Marx section... First there's an equivocation fallacy: it talks about Marx's opinion on land tax and Marx's opinion on Henry George interchangeably. It says "Marx's criticism of land tax" was that "the whole thing is" a last ditch effort to save capitalism. You can look it up yourself (The Manifesto and Marx's letter to Adolph Sorge) and see that Marx is giving two separate opinions on separate topics, or save yourself the trouble by thinking through it logically: How could Marx advocate a land tax in part if he thought "the whole thing" was bunk?

Again, below, the article uses "land value tax theory" (what is that?) to mean "Henry George."

That confusion as far as I can tell is the only basis for saying Marx "changed his opinion" on land value taxation. - JCH —Preceding unsigned comment added by 141.155.162.82 (talk • contribs) 21:31, 21 June 2007 (UTC)

Polluter tax

I removed the following because despite its claim, it does not describe a form of LVT: Another variation of Land Value taxation with broad support among economists is levying taxation upon polluting businesses.

The point about a bit of land (or radio spectrum or other analogous resource) is that there is a fixed quantity and thus taxation can have no effect on the supply. The number of polluting businesses, on the other hand, is not fixed and thus increased pollution-based taxation should affect the number (most likely by reducing it). -- Derek Ross | Talk 16:08, 2005 Jan 24 (UTC)

If I may suggest a compromise: a polluter tax can be seen as a form of LVT if it is implemented as a charge for holding tradeable emission permits. Pm67nz 10:10, 25 Jan 2005 (UTC)

[Interjected] I see what you mean but a tax on tradeable emission permits is rather different from a tax on polluting businesses. I might well buy tradeable emission permits for speculative reasons, if I thought that they were about to increase in value, even though I did not own a polluting business, so a tax on them isn't directly a tax on pollution. A tax on the permits would make speculation in them less attractive though. -- Derek Ross | Talk 16:17, 2005 Jan 25 (UTC)

OK, true, it's the limit on the number of permits that limits pollution, not the tax on the permits. Pm67nz 22:15, 25 Jan 2005 (UTC)

So land value tax may have no connection to land at all? Now I'm really confused? What is it then, just a general handle for idealogically sound taxation systems? Notinasnaid 11:00, 25 Jan 2005 (UTC)

No. Land value tax is a tax on the undeveloped market value of land, plain and simple. What makes it special is that the rental value of the land isn't affected by the tax rate. That makes LVT economically neutral. By which I mean that it doesn't harm the economy in the way that income tax or sales tax does -- income tax and sales tax both cause unemployment. Now there are a few other resources whose rental value is not affected by the tax rate such as radio frequency spectrum. You can apply the same type of tax to them. As a shorthand people often call these types of tax LVT because there isn't a special name for the type of tax and because LVT is the best known example. But the advantages of these taxes have nothing to do with being ideologically sound. In fact there may well be "ideologically sound" taxes which do not resemble LVT. The advantages of LVT and similar taxes are that they don't damage free market economies like most other taxes do. -- Derek Ross | Talk 16:17, 2005 Jan 25 (UTC)

Agreed, though I have to add that some supporters of LVT do see it in ideological/ethical terms, so what to include in "the advantages of these taxes" are could be considered a matter of opinion (I think that is handled OK on the Georgism page). Also many (most?) possible LVT-like taxes do fall under the definition of land (economics), which is close to the concept of "things of which there is a fixed supply". Pm67nz 22:15, 25 Jan 2005 (UTC)

Fair enough. I see what you mean about what constitutes an advantage being a matter of opinion. -- Derek Ross | Talk 00:51, 2005 Jan 26 (UTC)

I really cannot see the relevance of including spectrum/polluter taxes in this article. Perhaps someone can point this out more clearly - otherwise I propose the paragraph be removed. CustardJack 11:49, 18 Apr 2005 (UTC)

It's already been explained. Land, in economic terms, means the entire material universe outside of ourselves, and therefore includes both the radio sprectrum and the sky. —Preceding unsigned comment added by Silversoul7 (talk • contribs) 21:03, 18 April 2005 (UTC)

Urban sprawl

I am very new to the LVT concept but I like what I have read so far, but I can't see how it prevents something like urban sprawl - if LVT is lower for some attractive countryside land (being used for a park for instance) than the same size land closer to a city then what is to prevent manufacturing businesses (say) moving to the countryside so they can pay less tax? Yes, they are perhaps further from their markets, so incurr that cost, but when global transport is so cheap that hardly seems like a barrier. Yes, land planning rules/zoning could prevent the movement but as we know it doesn't seem that difficult for powerful lobby groups/organisations to effect zoning changes...Likewise for residential property, would not the rent someone pays for an appartment in the city be much more than the rent they would pay in a country area? Therefore inducing more people to move to the country, accelerating sprawl? AndyB 10:55, 3 May 2005 (UTC)

Well, there is more to transport costs than monetary costs. Time can form an important element too. Speedy delivery becomes more difficult as one moves further from centres of development. This is why companies are prepared to pay high rents to be right next to an airport when they could save money by renting a factory on a site even a little further from the airport. If they need that fast transport link, they're not going to relocate to the cheap farmland or forest at the end of a 10 mile track, unless they save an enormous amount of rent/land tax. That's why less attractive cities use subsidies or tax holidays to try and attract businesses (and why the businesses often shut up shop as soon as the subsidies stop).

Land tax shouldn't really affect sprawl one way or the other, so planning controls would still have a place if you wanted to try to reduce sprawl or whatever. I think that I can explain why. First the manufacturing businesses. You suggest that they would move to the countryside to pay less tax. It sounds plausible but remember that Land tax is basically identical to rent on a one-for-one replacement basis. So you could equally well ask, "what is to prevent manufacturing businesses moving to the countryside so they can pay less rent ?". (Note that even businesses which own their own land pay a form of rent in the shape of the lost interest from the money which they had to spend to buy the land). The straight answer is "nothing... but other factors such as availability of skilled manpower, speedy access to markets, etc. are very important". Different businesses will have different reasons for not moving to the country and the reasons that they are prepared to pay a higher rent will be the same as the ones why they would be prepared to pay a higher land tax whether those reasons are transport related or not. Just as businesses don't all rush off to the country to pay less rent at the moment, they won't do so in order to pay less land tax.

A similar argument applies to residential sprawl. Ideally we all want to live close to our place of work. Much as we may love the countryside, no one enjoys driving for two hours to get to work or to get home, and most of us are prepared to pay a premium in higher rent/mortgage/land tax to cut that time. The actual cost of transport may be low but personal time is valuable too. How much we are prepared to pay depends on our personal circumstances of course. This is one reason why rents and land prices for residential properties tend to rise as one approaches downtown in most cities. Once again if we note that rents/interest payments/Land taxes play identical roles in personal finances we can see that introducing land tax will not change the factors which encourage/discourage urban sprawl. -- Derek Ross | Talk 15:49, May 3, 2005 (UTC)

It may help to remember that in the specific case of rental property it is the landowner who pays LVT rather than tenant. The reason that the landowner can't pass the LVT on to the tenants by raising the rent is that landowners are assumed to have raised the rent as high as the market will bear for their particular property whether they pay LVT or not. If they try to raise it any higher, they won't get a tenant and will have to pay LVT in any case, so it becomes important that their property is let as soon as possible and as much as possible. It makes a lot less sense to keep a property empty while waiting for a tenant who will pay a very high rent since the cost of doing so may itself be high to the landowner in an area where land is expensive. This is the reason why LVT does not affect rents when it is introduced (although it does reduce the cost of land in expensive areas because less money can be made by renting it). -- Derek Ross | Talk 18:49, May 3, 2005 (UTC)

Urban Land

This tax was advocated by the Framers of the U.S. Constitution in 1789. Hamilton writing in the Federalist #36 gives the argument. It was probably known to Franklin and certainly known by Jefferson as ambassadors to France from whence it sprang via Quesnay and Turgot. Jefferson brought Du Pont to this country to promote the idea. Douglas Boyd, KYMAK agent http://www.geocities.com/douglas36601/pax.html 68.17.111.216 18:16, 22 November 2005 (UTC)

Some new players

I thought it might be creative to see if we might open up this good collaborative exercise and bring in the hundred or so members of a discussion group of the first rank (I think I can safely say) that has LVT and value capture (sadly still a null set here]] as its object the Land Café (you can get there by going first to The Commons, then clicking the left menu links, Collaborative Programs/Land etc. I have written a personal note to them today, and we shall see what this new blood might bring in to this important forum It is such an important matter, that I would very much hope that we shall collectively aim at getting it noted as one of the very strong entries in this weird place. ericbritton 09:17, 29 December 2005 (UTC)

I don't understand your directions for The Commons. What are we supposed to click on? I don't see "Collaborative Programs/Land". I'm mostly interested in LVT as an urban planning tool. Luciuskwok 19:47, 2 January 2006 (UTC)

Sorry not to have been sufficiently clear. Let me try it again: (1) http://www.ecoplan.org, (2) left menu: Collaborative Programs; then (3) Land/Value Capture; finally (4) Land Cafe. And there if you sort trhough a bit you will see quite a fair level of discourse on LVT et al. (You might also wish to use the Search gizmo for keywords. Hope it helps Luciuskwok. ericbritton 22:18, 2 January 2006 (UTC)

Here for you and friend Luciuskwok is the latest state of play in our greatly extended Land Cafe program. Your comments and participation are welcome. (Including if you will concerning the way in which we are trying to provide some creaitve synergistic interactions with Wikipedia.) ericbritton 14:49, 19 January 2006 (UTC)

Background

The sentence starting "An additional argument for LVT is that land values depend heavily on matters beyond the control of the land owner..." should be more direct and specific.

Suggested change (in italics) follows

An additional argument for LVT is that land values are created mainly by changes that are not the result of the landowner's own enterprise and effort; for example, the creation of new infrastructure, or a rezoning which can dramatically change the value of a piece of land. An LVT provides a way of recouping some of the windfall changes to land values that occur as a result of investment by government, placing less of the burden on taxpayers who don't benefit.

Janosabel 13:23, 19 January 2006 (UTC)

Looks good to me. Will you do this? ericbritton 14:50, 19 January 2006 (UTC)

Done. Janosabel 12:54, 25 January 2006 (UTC)

Australian perspective

Let's not just delete this wholesale. It's not vandalism. The contributor made some good points, albeit without using an encyclopaedic style. I have moved the text here so that it isn't lost to view.

If I can give an Australian perspective. Land taxes are an important part of the Australian and New Zealand taxation system with most local and a substantial amount of state revenue being raised through land taxes. This followed the visit to Australia by Henry George at the end of the 19thC. Australia took up land taxation with zeal on the basis that it is "incentive taxation" (a term used in the US). From a taxation point of view land taxes have a number of advantages over other taxes. These include the fact that land cannot be destroyed, hidden, shipped overseas or lodged in a Swiss bank account. Further, the true taxpayer is always known being the registered proprietor at the Land Titles Office. Therefore, under the land tax system rich people will always have to pay their fair share of taxes. It is made progressive with an increasing rate of tax scale.

The advantage of land value taxation over improved value taxation is that the fiscal cadastre (the taxation records) are easily and cheaply updated because it is 2 dimensional rather than 3 dimensional. The urban areas in Australia are typically updated every 2 years whereas the cycle for improved values is much longer and therefore, out of date improved values causing distortions are more likely.

Another advantage is that high land taxes will discourage speculation and landbanking, forcing owners to develop land rather than keeping the land vacant. This helps to keep land prices down. If this is not happening then the land tax is too low.

States in Australia where land tax is the major system of local taxation are NSW, Queensland and Western Australia. Both South Australia and Victoria allow a composite (and therefore, less satisfactory) system of improved and land value systems).

Some years ago RICS in the UK in their submission to an inquiry on land taxation addressed the proposal to convert the UK system of rental values (ie an improved value) system to a land value system such as Australia's, by the rather pompous statement that the land value system "has not proved itself" - despite nearly 100 years of land taxation in Australia. I would reverse the argument and state that despite costing about 4-5 times more than a land value system, the improved value system has not proved itself as superior and certainly not to the extent to warrant it's high cost.

farang

I am sure that the information that it contains can be used to improve the article. -- Derek Ross | Talk 23:23, 8 May 2006 (UTC)

Two rates

The article doesn't explain what a two-rate property tax is. Also, in some states, farm land and forest land is also taxed at a lower rate. This is not mentioned, is this an example of two-rate system? KAM 13:56, 29 October 2006 (UTC)

Two-rate systems normally split property value into an unimproved land portion and a portion comprising the property's buildings and improvements. They then tax the value of the unimproved land at one rate and the the value of the buildings and improvements at another. Hence "two-rate" systems. As you can see this is rather different from the examples that you asked about (which are not examples of a two rate system). Your examples are examples of Land Area taxation which is inherently unfair to rural owners owing to the low rate of return on rural land compared to urban land (and unlike Land Value taxation which is fair to all landowners since value is directly related to Rate of Return). Hence the lower rates given to rural landowners in an attempt to even out the taxation burden. -- Derek Ross | Talk 19:45, 29 October 2006 (UTC)

12/06 Cleanup

Ok, I think I've made some good changes. It still needs a lot of work, particularly with NPOV. I emailed the webmaster of this site, asking for permission to quote their page in the "Claimed advantages" section. Even if we keep most if it, it too is in many places POV. For now, I'm sick of working on this page and will take a break. --Explodicle 19:02, 2 December 2006 (UTC)

I've received permission to use their content, as follows (except for crossed out names):

Dear XXXXXX,

I am pleased to know that you are interested in the subject of Land
Value Taxation, for whatever reason, pro or con.

I and my colleagues have been aware of the possibility of
Wikipedia but have refrained from contributing simply because the
economics of Land are not well understood (even by academic
economists) and this leads to rants and opinions rather than
research, evidence and logical explanation. So we do not bother,
though scanning the Wiki article and the Talk pages I think we
must reconsider our position on this.

You are welcome to use any or all of our articles put up on the
websites. Our offerings have been used in many places, and not
always to our advantage. Many of the criticisms have been
spurious and misinformed. That is simply because our detractors
(and sometimes our supporters) have the tendency to view any
situation from the current/existing taxation regimes into the system
in which LVT operates - it just can't be done that way.

An example of this is when land holding by (tenant) farmers is
discussed. It is always assumed that LVT is a tax =added= to
existing levies which would bear heavily on the margins and
therefore on marginal farmers. But the application of LVT assumes
that for any LVT levied, there will be reductions in all other taxes -
ultimately collect LVT revenue only. We seem to forget that every
farm has to pay wages on which there is Income Tax, and every
farm pays profits or corporation tax, and many are caught with VAT
on machinery and other items. So the effect of LVT is to reduce
total taxes borne by lesser-valued sites and the margins - bearing
to the ultimate aim of NOT TAXING WAGES (all forms) OR
INVESTMENT. And not based on transactions but on evident
advantages.

I also consider the second para of the Wiki article to represent one
of the "parochial" views of LVT. that it discourages "speculative
bubbles" in land markets. Of course it does, but LVT should not be
thought of as an economic weapon in the chancellors's armoury. I
like to think of LVT as the just return to the community for the
monopoly right to exclusive use of the land (and thus keeping all
others from its use).

The land value arises from the nearness to resources and to the
efforts and presence of people both near and far (to create the
markets and infrastructure from which the site benefits). Thus, as
is said somewhere in the article "created by the community and
returned to it".

There are many "picky" points I could make all the way through the
article, but as I say above, that leads to endless arguments.

What I have been researching for the last eight years is the
locational advantages of countries, regions, sub-regions and cities
over the whole of Europe from Ireland to Turkey, from Finland to
Spain. The locational effect is evident over the whole area. It
explains why there are economic disparities. It illustrates that
harmonised taxes will lead to the instability and poor economic
performance across the continent. And even down the local High
Street and the urban/rural dichotomy. All are examples of the
locational (land value) effect taken with illogical taxation and high
rents.

The latest fashion is green taxes and carbon taxes. These will
discriminate against the remoter locations and poorer areas. The
NorthEast uses at least one month more heating fuel than the
Southeast, and the transport costs are proportional to the distance
to the market or centre of population (London and the SE, or even
Frankfurt in Germany, the centre of the EU market). So, the
Green/Carbon taxes will cane the NE, N-Ireland, Scotland and
Cornwall.

Perhaps you can see why I (we) don't enter the Wiki world.

Again, you are welcome to use any of the material on our website.
But I must deter you from using the /nopasson.htm page - it is
correct but needs a more precise explanation of the mechanism
that supports that view (when I have the time).

If I can help you in any way - eg examining your arguments or
suggesting additions - then let me know.

Regards,
XXXXXX,
Oxford.
Webmaster for LVT Campaign

--Explodicle 02:27, 6 December 2006 (UTC)

That's good news, Explodicle. I must admit that I thought our article was fairly sympathetic to the LVT concept already. And as a lifelong supporter of the idea I was quite happy about that. Most of the material has been added by proponents rather than detractors. I don't think that the LVT Campaign webmaster would have run into major problems refining what is already here (although he would have needed to use the Neutral Point Of View style which many Wikipedia neophytes find difficult) but I am fairly sure that most of us would welcome his input even if it needed to be reworded a little. -- Derek Ross | Talk 04:28, 6 December 2006 (UTC)

Open Spaces

Just a quick note on the latest addition.

Another issue with LVT in large cities is that a pure LVT does not have a provision for open spaces in a densely populated city. Any parkland in a city would have an economic value higher than its usage as a park leading to parks being removed and the city losing out in the process, due to lack of open spaces. Thus, an LVT has to have important exceptions for open spaces to be preserved.

While this might seem reasonable in theory, it's not actually a problem in practice. The reason is that open space/parkland is almost invariably publically owned and thus the authority levying the tax is generally also the recipient of it. In that situation, the chances of the City council selling a park to avoid the Land Tax (which it would be paying to itself in any case) is probably less than the chance of the City council selling a park in order to reduce its longterm debt. After all even when no Land Tax is involved the city is missing out on the rent which it could raise by building tower blocks on all that lovely open space. Yet somehow it manages to resist the temptation to do so for rent, even for such an extremely rentable property as Central Park. I suspect that it would also resist the temptation to do so for Land Tax. Of course the paragraph is spot on as far as private parks are concerned. -- Derek Ross | Talk 06:04, 9 January 2007 (UTC)

Or to put it another way, well kept green spaces keep land values up. So selling it for just an extra acre to tax would be silly. —Preceding unsigned comment added by 86.138.253.26 (talk) 01:37, 6 December 2007 (UTC)

NPOV

The lack of NPOV in this article has a very simple explanation: the more one knows about taxation and LVT, the more difficult it becomes to remain neutral on the subject. To those who understand it fully, implementation of LVT is roughly equivalent to the emancipation of slaves. Does the Wikipedia article on slavery maintain NPOV? Or does it state the fact that slavery is an evil relic of barbarism intolerable to all civilized people? It may take a century or more, but there is little doubt that by comparison with LVT, the future will view our current atrocious taxation systems as effectively nothing but part-time slavery.

How much neutrality is possible to those who have apprehended the fact that private capture and retention of the publicly created economic rent of natural resources is the greatest evil in the history of the world, an evil that has directly or indirectly caused most of the other evils (especially poverty and war), an evil that has inflicted more harm, suffering and injustice on humanity than slavery, communism, fascism and religious intolerance COMBINED, and that continues to inflict a Holocaust worth of harm, suffering, injustice, oppression, torture, robbery, starvation and death on innocent people EVERY YEAR?

In point of fact, all objections to LVT have been comprehensively refuted, save one: that it does exactly what it says it will do, shift the burden of taxation off productive economic activity -- work and capital investment -- and place it squarely on the unjust privilege of charging others for access to what nature provided for free. The unrefuted "objection" to LVT is simply that we are accustomed to the injustice of private landowner privilege, and that many of us -- especially those in positions of wealth, power and privilege -- have come to count on (and yes, greatly to enjoy) being its beneficiaries. —The preceding unsigned comment was added by Roy Langston (talk • contribs) 23:00, 9 January 2007 (UTC).

The slavery article does maintain NPOV. For instance, one might say that "slavery is considered morally objectionable by many" is more NPOV than "slavery is the most evil thing there ever was". You have to keep in mind that there are many people who are just interested in a more efficient economy, and don't get quite so worked up about it. --Explodicle 15:50, 23 January 2007 (UTC)

I've just read the Slavery and LVT articles in their entirety, and while the slavery article is much more detailed and comprehensive, there are a few passages where the evil of slavery is identified and decried. I do not see the slavery article as has having a perceptibly more NPOV than the LVT article.Roy Langston 07:02, 5 February 2007 (UTC)

Where exactly is this POV content? The word "evil" does not currently appear in the slavery article. If you do think that the article is POV, please identify specific passages and tag the article for improvement appropriately. ALL of our articles are supposed to be NPOV, no matter how strongly you (or almost everyone, in the case of slavery) feel about the issue. Sorry it took me so long to reply. --Explodicle 01:26, 24 June 2007 (UTC)

Loss of Asset Value

When slavery was abolished slaveowners suffered a 100% loss in asset value with regard to their human "assets". Thus they were understandably reluctant to agree to it (for that reason if no other). Yet abolition was unquestionably the right thing to do. Not only from the obvious moral point of view, but even from the less obvious economic point of view (Smith explains why slavery is economically a very bad thing in The Wealth of Nations for everyone other than the slaveowners at any rate). As the new section points out introduction of LVT would potentially cause the same type of economic dislocation and loss of asset value as the abolition of slavery (although the amount lost is dependent on how developed a piece of land is -- only vacant and completely undeveloped lots would suffer a total loss of value since LVT is not levied upon the improvements that a landowner may make to the land). Nevertheless, like the abolition of slavery, the introduction of LVT in place of other taxes is economically the right thing to do however carefully it may need to be done. -- Derek Ross | Talk 05:02, 23 January 2007 (UTC)

Another angle on land is opened by this section, probably inadvertently.

Little loss of real "asset value" was suffered by the slave owners. The ex slaves released had to go back to ex-owners, offering to work on the same plantations since they had no land from which to make a living. But this time around the ex owners had no moral or financial obligation to take the welfare of the "free" labourers into account because they no longer figured as owned assets.

Janosabel 16:44, 18 May 2007 (UTC)

Problem with "claimed disadvantages"

There is a problem with the things that come under "disadvantages". This is supposed to present the opinions of those who claim disadvantages. It is not supposed to be a place for discrediting those opinions. Imagine if following each of the claimed "advantages", an editor added "This is of course a naive misunderstanding and it wouldn't work in the real world.": this would be rightly recognised as editorial opinion and would be promptly removed. Similarly, "Bates (1973) discredits this argument" (imaginary scholarly argument, but just as bad).

I have removed the following from the section on Herbert J Davenport. I have added bold to show that the author has allowed their own opinions to dominate the discussion. Even where the language is neutral, all of the writing is devoted to showing that Davenport is mistaken.

However, these claims are highly dubious. Most land tax proponents do not consider fertilization (and other improvements) in the value of land but rather classify it as natural capital. It is also nonsensical to claim that a land value tax would be a tax on the production of farm goods, as the tax would be exactly the same whether any goods were produced on any particular farm or not. Moreover, as land rent is defined as the most users would willingly pay for the advantages of using a particular land site, it is impossible for a tax that only recovers land rent to push useful land out of use (though it may lead to the abandonment of inferior land currently in wasteful use, as more productive land is brought into use instead of being kept idle for speculative gain). Davenport may have been confused on this point by the rare historical examples (such as in the Late Roman Empire) of land taxes that were not based on land value or land rent, that exceeded the land rent, and that consequently reduced the land's value to a negative quantity and drove it out of production.

Urban land is somewhat different, since its owners collect rents on site value. Nevertheless, Davenport claimed that any effort to tax such rents would lead owners to economize on the land by building higher buildings and deeper basements than would be economically efficient. This argument contradicts standard economic analysis, by mistakenly conflating the roles of landlords and land users. Land users are willing to pay a premium in order to locate in economically beneficial areas. They pay for that benefit either directly to a private landlord, or by forgoing the income they would earn by selling or renting the parcel. LVT does not change these basic incentives; it improves economic efficiency by increasing market liquidity as well as avoiding the deadweight losses associated with property taxes and other taxes.

I am no expert on this subject, but I'd like to think I can spot an author's point of view. Please take this as a ground rule: if the author's opinion can be discovered or reasonably guessed by reading the article, then it cannot meet Wikipedia:Neutral point of view. Notinasnaid 12:55, 6 February 2007 (UTC)

That seems reasonable. -- Derek Ross | Talk 19:02, 6 February 2007 (UTC)

POV tag

This article is written in a manner which is fairly clearly POV; there's some evidence of this on both sides of the issue, but it's mostly "pro"-biased. The most notable indicator of this is the "Arguments For" section. If these things are all objectively true, they needn't be listed in such a manner; if "a better economy" is an outcome, than that can be listed in a description section. (Of course, I doubt this is a universally-accepted fact, or this tax policy would be implemented everywhere.) If they're not, the author shouldn't imply otherwise.

Furthermore, many of the arguments are redundant. Two are identical, claiming a stronger economy as a benefit; one, "more efficient allocation of land," shows up with multiple veneers (reduction of urban sprawl and of inner-city ghettos are both iterations of the same benefit; they can be mentioned separately, but it should be under a common subheading).

Others don't belong on this page at all, like these:

1. Fairness. Land (unlike goods and services) has no cost of production. If an ample supply of land of equal desirability were available everywhere, there would be nothing to pay for its use. In reality land acquires a scarcity value owing to the competing needs of the community for living, working and leisure space. Thus the unimproved value of land owes nothing to the individual efforts of the landowner and everything to the community at large. It belongs justly and uniquely to the community. Conversely, the reward for individual effort can belong only to the one who earns it, to spend, save, or give away as he or she may see fit.
2. Voluntary. The tax is completely avoidable. Anyone who does not wish to pay it need only rent land in place of owning it

The 'fairness' argument defies fundamental economic theory, because it disregards the potential benefits (both personal and societal) from fruitful speculation. In other words, investing in real estate isn't fundamentally distinct (in this regard) from investing in stocks or the futures exchange. (FYI, there's no mention of this in an "Arguments Against" section, and I'm sure I'm not the first person to think of this!)

The "voluntary" argument is just self-evidentially absurd, to the point of facetiousness. That same "benefit" applies to all taxes: if you don't want to pay income tax, just don't get a job!

Anyways, this needs to be reworked by someone who won't allow his or her opinion to impugn the article's quality (or someone who just doesn't give a damn about the issue). --Xiaphias (talk) 10:05, 19 November 2007 (UTC)

• Also, if you're paying rent you're just paying the tax through a middleman. You are in no way avoiding it. I noticed this POV about a year ago but never really got around to fixing it... maybe I should get started again. --Explodicle (talk) 13:38, 19 November 2007 (UTC)

The "voluntary" argument is not so absurd. For instance poll taxes are completely involuntary: if you're alive, you pay. Sales taxes vary in how voluntary they may be: a tax on luxury foods such as caviar is pretty well voluntary whereas a tax on necessities such as bread is pretty well involuntary. Income taxes are involuntary since a person without income eventually becomes a person without savings. And a person without income or savings starves. Hence we must have an income to survive. Hence we must pay income tax. Contrast that with LVT where we do have an easy choice. If I object to paying LVT, I take my money out of real estate and put it into a corporation like Boeing or IBM instead: no starvation (or even noticeable hardship) required. As for "paying through a middleman", the "middleman" will charge you the same amount whether LVT exists or not. So it can't be LVT that he is charging you. It's just the same old rent. -- Derek Ross | Talk 16:31, 19 November 2007 (UTC)

• Not at all -- just because you don't have an income doesn't mean you'll starve. There's thievery, government welfare, homeless shelters, mooching off relatives...tons of options. They don't seem very desirable to you, but perhaps forsaking caviar seems equally undesirable to someone else. Who gets to decide which sacrifices don't really matter? --Xiaphias (talk) 20:11, 20 November 2007 (UTC)

Beats me. But I was making a point about how hard the other options were, not how much they mattered or how desirable they were. Personally I find the idea of mooching off relatives quite appealing but it's too hard to get them to agree to it, so I guess I'll just keep on working, <grin>. All I'm saying is that there are degrees of "voluntariness"; it's not just yes or no; sometimes you are presented with a choice where it's 50-50 and sometimes you get an offer-you-can't-refuse. -- Derek Ross | Talk 22:06, 20 November 2007 (UTC)

• Even though I'm a LVT advocate I support deletion of the "voluntary" argument. It may or may not be absurd but it surely isn't a strong argument or an important one. Pm67nz (talk) 22:58, 20 November 2007 (UTC)

Can Land Value Tax be passed onto leaseholders (aka renters)

• Perhaps I'm confused... are you assuming some sort of rent control? I don't see how a landlord could afford not raising rent if taxes go up. --Explodicle (talk) 20:08, 19 November 2007 (UTC)

• You are indeed confused, but then so are most people. Rents are determined by what tenants can pay, not by the expenses of the landlord. A landlord who had say inherited the land for free and not been taxed in any way would still charge the tenant the going market rental. Conversely many landlords are right now spending more on mortgage interest payments than they expected, more even than they get in rent, they are taking a loss and yet they don't raise rents because they can't do that if they want to have any tenants at all. If my explanation isn't clear there's an Adam Smith quote on the Georgism page that says much the same thing, but just about as briefly, and for a modern economist's take on it complete with supply and demand curves look up "elasticity and tax incidence". Mankiw's economics textbooks include a very good explanation, just keep in mind that we are talking about the rent of land here (not houses, apartments or other buildings which sit on land) and the supply of land is completely inelastic. Pm67nz (talk) 02:12, 20 November 2007 (UTC)

• So why don't tenants just move to the cheaper apartments? In my experience landlords have always had to compete for my business. Would you please provide a link with supply and demand curves... if you are right, I'm totally putting this in the article because it shocks me. --Explodicle (talk) 05:24, 20 November 2007 (UTC)

• Re tenants and/or you choosing cheaper and/or better appartments: of course, but I don't see how that is a reply to what I wrote above. Re supply and demand curves: forget about hunting down Mankiw's textbook, wikipedia has a good Tax incidence page with S/D diagrams. LVT is an extreme case of the "Inelastic supply, elastic demand" case described there. Pm67nz (talk) 06:26, 20 November 2007 (UTC)

• Thanks! I'll give it a read when I get the chance. --Explodicle (talk) 13:49, 20 November 2007 (UTC)

• (*Smacks forehead*) Ok, now I don't see how I failed to understand that. :-P ...I'll get to work on on an SVG diagram, since the one on the tax incidence article isn't a completely inelastic supply. --Explodicle (talk) 17:34, 20 November 2007 (UTC)

• If you want to get completely carried away with the S/D diagram(s) a bit of shading can show how the inelasticity also prevents the tax from having any deadweight loss (ie: it doesn't discourage the use of land). There is an example of such a diagram at [2] but I haven't found one on wikipedia (the closest is on Monopoly, which is similar but not about taxes), so if you want to add or improve the diagrams on the Tax or Tax incidence pages too... Pm67nz (talk) 22:58, 20 November 2007 (UTC)

• Sounds good. Step one: I must learn how to make SVG files. :-) --Explodicle (talk) 04:45, 21 November 2007 (UTC)

• So why don't tenants just move to the cheaper apartments? --- Rent is determined by whatever the landlord can get away with charging, not what a specific individual can pay. Rents absorb most of the profit that can be made by living in a prime location versus living in the middle of nowhere. See Law of Rent —Preceding unsigned comment added by 86.138.253.26 (talk) 02:09, 6 December 2007 (UTC)

A few misconceptions

While overall LVT is certainly one of the least offensive taxation schemes, the following is a list of misconceptions and economic absurdities in the "advantages" section of this article:

LVT cannot be passed on to tenants, as they are already paying the full market rent, and the tax does not affect the economic rent of the land.

[Interjected] Adam Smith, The Wealth of Nations Book V, Chapter 2, Part 2, Article I: Taxes upon the Rent of Houses: "A tax upon ground-rents would not raise the rents of houses. It would fall altogether upon the owner of the ground-rent..." —Preceding unsigned comment added by 71.229.1.87 (talk) 19:32, 9 April 2008 (UTC)

In actuality ALL expenses are taken into account by the landowner when setting the rent. The LVT is an expense incurred by the landloard and will most certainly be passed on to the tenants same as any other expense up to the full market rent as influenced by other landlords (presumably also affected by the LVT). I have no doubt that we would see major changes, but the assertion that an expense cannot be passed on to the tenant is absurd. As a matter of fact, all expenses affecting all competing landlords (such as any type of local land tax) will most surely be passed on to the tenants.

What I object to here is the wording which makes it sound as if this one particular form of taxation cannot be passed on to tenants whereas others can. This simply is not true. The full market rent is partly dependent on existing local land taxes. It will still be dependent on any replacements for this existing tax, even if calculated differently.

Thus the unimproved value of land owes nothing to the individual efforts of the landowner and everything to the community at large.

There are two fallacies in this statement:

[1] There is no such thing as the community at large. There are only individuals composing said community (which would require an arbitrary definition on who and what is included in this community). Assuming the individuals composing the city are the ones forming this community one would need to ask the following question: are they all responsible for improving the land values? Are the decision makers (some members of the city council)? Are the tax paying landowners responsible by providing funds to the city (leaving out all non local taxpayers)?

[2] Sometimes the value of nearby land is raised solely based on the actions of one neighboring landowner (building a private park, school or simply bringing new jobs). In this case, should his neighbors pay him the LVT on the added value that he brought to their land? Or should the individual responsible for the improvement pay it to the aforementioned community?

IWantToLiveFree (talk) 03:40, 12 January 2008 (UTC)

[Interjected] I think that if you look at some applied stastitical work from W. Edwards Deming, you see that there is no way to actually exactly parse out individual contributions because of common cause variation and because of interactions among and between people. 69.250.30.31 (talk) 01:24, 18 March 2008 (UTC)

Let's see if we can clear these misconceptions up.

Firstly, let's take on example based on your expenses misconception. What you are saying implies that, because his expenses are so much lower, a landlord who rents out car parking spaces on an empty lot can charge much less than a landlord who has taken out a big high-interest loan to build a multi-storey car park on the lot next door. But does he? Well, sorry but the real world doesn't work like that. Go downtown to check it out. You will find that the two landlords charge about the same. The rent isn't based on the fact that the first landlord had far smaller expenses than the second. It's based on what the consumer will pay for a parking space in a competitive environment. And that has nothing to do with either landlord's expenses, about which most consumers neither know nor care. So in effect, the second landlord is unable to pass on the interest of his loan to the individual consumer, no matter how high the rate might rise, and instead has to settle for increasing the number of consumers which he can get revenue from.

Now looking at your second explanation on the community, you seem to be in two minds about whether such a thing exists or not. First you say that there is no such thing. Then you say that there are only the individuals that make it up. Well forgive me for being slow, but I find it difficult to see how something which doesn't exist can have any individuals making it up. If Martians don't exist as a group then they don't exist as individuals either. It doesn't really matter that the rules defining the group are arbitrary providing that most people agree with them.

Lastly your questions on who should receive the LVT. I wouldn't see anything particularly wrong with paying the LVT to individuals who raise the value of all their neighbours' land. It seems to me that they deserve it. The only problem is working out who caused what, and by how much. Even so I'm sure that an arbitrary but generally agreed formula could be devised. Your last question is based on a misconception: LVT is never levied on improvements. It is only based on the value of unimproved land. So your individual would never be liable for increased tax based on improvements that they (or others) had made to a particular empty lot, or buildings that they had erected on it. -- Derek Ross | Talk 05:26, 13 January 2008 (UTC)

Hey Derek, actually you are partly right and partly wrong. Please check the wording and you'll see that I acknowledge part of what you are saying in my explanation.

Not all expenses can be passed on to the renter, that much we agree on. And indeed, the renter doesn't know nor care about them. However, expenses incurred by ALL landlords in the area in a similar fashion (the perfect example would be ANY kind of land tax) will raise the base rent partially or wholly. If the expenses for all landlords in the downtown area went up 20%, then you'd see a corresponding increase in rents if the renters could afford it. If they can only afford a 10% increase, the landlords will be forced to cap the increase up to that amount. We will then see some landlords who would have otherwise rented out their property, try to sell it instead to people who will buy it as a primary residence. But this is NOT likely to happen. In fact, it is more likely that the landlords will be able to pass on the full tax increase and find new renters. Here's why:

You mistakenly assume that the full market price is not influenced by anything but what renters are able to pay. This full market price is influenced by supply and demand. If the area becomes more desirable, the property values will go up because more people are willing to come in. If more people are willing to come in, more potential renters are available and therefore there is a greater ability of landlords to pass the corresponding tax increase on to them.

In any case, even if the assertion was true (and it is not), this article still fails to explain why this tax would be different from a regular property tax in regards to passing on the costs to the renter. Just as a reminder, the assertion is that this specific tax CANNOT be passed on to renters, whereas (implied) others can.

Lastly, may I remind you that if a land tax cannot be passed on to the consumer per se, then there is no point in having this included in the advantages of this particular tax anyways.

Either way, this argument is bogus or irrelevant and should be removed in my opinion. I am not a vandal, nor am I a skilled wikipedia contributor so I certainly wouldn't take it upon myself to do it, but people's liking the LVT should not cloud their judgment.

Now on the community thing. I am of one mind only. Communities do not exist as conscious agents but as arbitrarily defined groups of conscious agents, who only very rarely share the exact same amount of responsibility.

To put it another way, I am not saying communities do not exist any more than love does not exist. Love is a concept that cannot act of its own volition. Neither can a community. That's all. Attributing an action to the community at large (in this case, an ill defined, very large group of people) is as silly as attributing an action to love itself. Only individual lovers are capable of such a thing.

And indeed, I don't mind the arbitrariness of such groups. I do mind the silliness of collectivism insofar as responsibility goes.

As far as my misunderstanding the LVT, I am afraid the misconception is entirely yours. I hate being adversarial but as the saying goes, there's no winning an argument anyways, we can only hope to convince uninvolved readers and not each other :)

Let me explain then. The land value cannot be entirely dissociated from the improvements to buildings or other non tangible things (such as a group of highly educated people moving in as opposed to street thugs). By building a private school (building with a purpose) on my land, I also raise land values all around it, which in turn will increase mine as more activity and higher income families move into the neighborhood. The LVT, if I'm not mistaken, is based on the so called unimproved land value (without the buildings and man made objects on it). However, the desirability of the land depends heavily on what people can expect to do with it and supply and demand for nearby lands. This is all tied in together.

If you were somehow able to perfectly isolate the value of the land from that of the building standing on it (which is no small task), you would still have to admit that the value depends quite a bit on what yourself and/or others did to nearby properties. For instance, if you were to build the private school and own a house nearby, your building the school would raise your land value. As a matter of fact, you could build the house on the same plot of land then later decide to sell only this portion which you don't need anymore. Your building something has indeed raised the so called unimproved land value of what you are now selling.

IWantToLiveFree (talk) 06:35, 13 January 2008 (UTC)

Well, reading what you have just written has convinced me that we are perhaps not so far apart as might at first have appeared. You have certainly explained your points much better in your second post than you did in your first one, so I now feel that we could actually come to a common understanding of the issues that you have raised. In particular I now understand what you are trying to say about communities and would agree that it is a reasonable opinion with which it would be difficult to disagree. It's bedtime for me now so I won't address your other points tonight. Hopefully someone else will tomorrow but if not I'll come back to them. Cheers Derek Ross | Talk 08:07, 13 January 2008 (UTC)

Please read Tax incidence. Of course rents are set, like all prices, by the law of supply and demand, but in the case of land the supply is fixed (or perfectly inelastic as economists say) and so only the demand can change and thereby change the price. This isn't just a pet theory invented by random wikipedia contributors - it appears in economics texts ranging from current textbooks right back to Wealth of Nations, which is now quoted in the article. Even your attempts at examples of how landlords might be able to pass on an increase in their expenses actually all depend on an increase in demand, not any change in supply. The best an unsatisfied landlord can do is, as you say, to sell the land to another landlord leaving the supply of land unchanged (from an economist's point of view even owner-occupiers don't reduce the real supply of land, rather they are renting from themselves, and so are still landlords). Compare that with providers of goods such as new buildings, they will reduce their output if they are not paid enough to make it worth their while. Pm67nz (talk) 10:05, 13 January 2008 (UTC)

My examples are not necessarily less relevant or potent than those taken out of economic books. By this token I'd have to concede that all economists and any and all examples they have (some of which contradict other economists' examples) would be automatically superior to mine. I find that idea insulting. I may have misread your intent though.

Unfortunately, there is a new misconception here. When people buy land, they buy it for a reason. The common misconception (even among some economists it would seem) is that the supply of land being inelastic (which is mostly is) the supply part is also inelastic when considering rents. This is where building things comes in handy. By allowing Landowner A to build a new extension on top of his existing building, we may very well decrease the desirability of nearby unbuilt land by increasing the supply for what people actually want (residences to live in), therefore lessening the need to acquire new land. Again, the forces at play here are always more complex than meet the eye, and we can see that what is built on the land DOES affect the price of land itself in the area. The unimproved land value is a fuzzy concept at best.

But then again, this is simply an aside as what you raised here does not address my example at all. And in fact, should building extensions prove impractical, it will therefore allow landlords to pass on the increased tax to the renters as per my example. The land will be more desirable as the supply of residences remains mostly fixed and the price of land goes up (because more people are willing to move in in the first place). More competition for the existing residences means landlords have a greater ability to pass their costs on to renters.

So in essence, whether the landlord is able to increase his own supply of residences using his existing land or not, he will still be able to offload his new tax burden, either to a greater number of renters or by increasing the rent. And because it is much easier to increase the rent, this partly explains the lack of interest in building costly new extensions to existing buildings (among other things, there are government regulations and cost considerations as well).

In any city center where the tax burden is increased by decree, the average rent will necessarily go up almost mechanically with only a few new residences being added to the pool. This increase will not be immediate as many factors conspire to force landlords to delay the increase.. but it will go up eventually.

In cities with rent controls, you will see more landlords selling their lands. This is also problematic as this will end up distorting the market. Those landlords unable or unwilling to sell will necessarily have to cut back on maintenance or other related costs (again, all landlords are affected at once and they can afford to do that because of the high desirability of land). In any case, higher taxes are made up for via higher rents or lower quality housing. There is no such thing as a free lunch.

Because the fairness portion of this article is based upon the assumption that some things are not earned by the landowner and he therefore should be taxed on them, I highly recommend you read [3] for a more eloquent explanation of why earned versus unearned is an absurd slippery slope toward totalitarianism.

Of course, I could still argue that in many cases it is almost impossible to determine who is responsible for what improvements in the land value (and in some instances, the very landowner himself is).

IWantToLiveFree (talk) 15:47, 13 January 2008 (UTC)

I don't visit Wikipedia to debate, so my answers will be terse compared to yours. Argue with Derek instead, he's much more polite than me. Taking your points one at a time:

• My appeal to authority might be out of place if I thought I could use it to change your mind, but is appropriate when defending the content of an encyclopedia, in which context Adam Smith + Gregory Mankiw trumps User:IWantToLiveFree. Also it takes me much less time than arguing the case myself.
• Excuse me for ignoring asides, one issue at a time is enough for me.
• You are still invoking "more people" or "a greater number of renters" who want to live in the area, ie: an increase in demand. When arguing economics it very much helps to start out by changing just one exogenous variable at a time, in this case the rate of LVT. Of course an increase in the number (or the wealth) of would-be tenants increases rents, but that effect happens regardless of the tax rate, it is a different matter entirely.
• "it will go up eventually" - yes, as increasing demand or inflation allows, but then it would have gone up anyway, unless the landlords are unusually generous.
• "rent controls" - I'll ignore this, this is a page about LVT, not rent controls.
• Higher LVT is "made up for" by lower purchase price, or approximately equivalently, lower mortgage payments.
• "There is no such thing as a free lunch" is a nice slogan, and yet any hunter-gatherer can tell you it isn't completely true - sometimes you just stumble across lunch by accident. Nature is the original free lunch because nobody had to pay for it to be made. Why today I enjoyed the sun on my skin, for free! Anyway no one is claiming that the tax take comes out of thin air, with a high LVT speculators in land value go out business, but they aren't missed.
• [4] is an improvement on Rothbard's argument, but I still find it a silly one. It has 2 parts: A slippery slope fallacy, which I agree is absurd but maybe not in the sense that you meant it, and a claim that it is in practice not possible to know land values, which would surprise the property valuers (USA: "appraisers") in those places where they are obliged to do exactly that because, for example, LVT is charged.
• "it is almost impossible to determine who is responsible" - well we all agree about that, and that is enough for the foundations of a weak form of the fairness argument. That section is overstated at present, AFAIK even most Georgists don't say that the surrounding community is entitled to the increment in land value because they create it, but rather that the landholder owes them compensation for excluding them from a part of nature which they would otherwise be able to use themselves. Even that Georgist argument should go in a separate section though - the most mainstream version of the fairness argument is that since increases in land value are not in general created by (ie: earned by) the landlord they have no particular right to it. Of course existing landlords may be hurt by the drop in land value caused by the initial introduction of the tax, but that's another story. Pm67nz (talk) 00:56, 15 January 2008 (UTC)

• I do not aspire to be quoted in this encyclopedia. I am offended however that my examples would be deemed less worthy of examination in this discussion page solely based on the fact that they are mine and not somebody else's.
• You are mistaken. The exogenous variable is not necessarily the rate of LVT. It could be the extra amount of LVT being charged should the land value go up. The land value would go up because of a greater desirability of the land, hence my example with a greater number of people willing to occupy that land. Remember the assertion here is that the LVT CANNOT be passed on to renters. I only need find one instance where this is false.
  And again, regardless of whether it can be passed on to renters, you fail to explain why this would be different from any other land tax and why it should be kept in the "advantages" section.
• The hunter-gatherer will not get his lunch for free either. While it is true that whatever nature produces of its own comes free of charge, there is little that can be obtained in a usable form without some form of labor (the hunter-gatherer will tell you that). Conversely the bare land itself comes free of charge in a mostly unusable form. The unimproved land concept is pretty much useless as nobody values unusable land. Value is given to what can be expected from the land via added labor. That value is different from person to person and depends on so many factors that the only way to find out is to make an actual sale (land with nothing else on it, and no transformation whatsoever). And even then, you would only know one of the prices the seller was willing to give it up at, and one of the prices the buyer was willing to purchase it at. You would still not know what the seller or the buyer value the land at. Much less what others could have valued it at had they known about the sale, or even what it will be worth to the same people 2 weeks later or earlier. There is no objective universal value. Which leads us to...
  The argument is not that property appraisers do not exist, but that they cannot know the value of the unimproved land (ie. this is a subjective estimate, which cannot be the objective value of the land, since values are inherently subjective).

• The fairness argument is really worse than the rest. This is draping state initiated violence in the pretty coat of justice, which is what the Nazis did when they plundered the Jews. Let's look at it:

• you admit that it is almost impossible to determine who is responsible for what, yet you still assert that "since increases in land value are not in general created by (ie: earned by) the landlord they have no particular right to it". You cannot appeal to a statistical truth in order to make individual judgments. "Because minorities are more likely to commit crimes, let's round them all up and treat them as criminals". Hardly fair.
• The landowner is not always excluding them from that part of nature which came free of charge. More often than not he is excluding them from what he transformed with his labor (made flat, removed trees from, landscaped, fenced and kept pest free) and from other man made objects (house, driveway, terrace and pool). Only rarely is the owned land in an unimproved state, and yet proponents of the LVT are proposing to tax it all regardless.
• Finally if you wanted to make people pay for that part which nature gave to them free of charge and which they are excluding others from, you'd have to include everything, not only land but all energy produced by the sun (which is responsible for almost all of the other energy sources on the Earth) and the air we all breath (would you support taxing fat people more?). Yes the land is finite, so is the air we breath and the amount of energy, fossil or renewable. Yes people can breath air that is not in my lungs, so can people move to a different plot of land or move out of my shadow and sunbathe. But that's not it, you'd also need to tax the buildings same as with a regular property tax. Why? Because the buildings were partly made with free gifts from nature (rocks, water, cement, sand, wood...). You can push this to its logical conclusion and tax everything and everyone.

• Oh and by the way.. why should the so called community, which did NOTHING to bring about these gifts of nature, reap the rewards of that which it didn't seed? The part of nature which comes for free was never pre-owned and comes free of encumbrances for those who can appropriate them.

IWantToLiveFree (talk) 03:29, 15 January 2008 (UTC)

Removed section

I removed this section below: I don't understand how it fits into the article as a NPOV or into the section it was put. I think that there are probably parts of it that could be edited and sprinkled throughout (maybe). But it seems more like the would be editor really is trying to start a discussion and clearly is asking questions.*[5] 69.250.30.31 (talk) 13:35, 10 February 2008 (UTC)

A Neutral POV may be impossible on such a controversial subject. Negative POV's can easily hold sway here and completely confuse this issue. I have made a few corrections in my text for clarification. DAB (talk) 17:50, 12 February 2008 (UTC)

Please use this information as you please subject to my correction and revision if necessary. I am a slow writer, often correcting myself, at my convenience in my leisure. As an Architect I learned about Henry George from Frank Lloyd Wright*[6] and have studied the LVT idea since about 1968 when I read PROGRESS and POVERTY and took a course in economics offered by the Henry George School. I have several hours of Academic credits in economics from accredited Colleges and Universities. In ECON 201 and 202 the textbook, c. 1973 had a chapter on LVT or SVT. Later, from the Univ. of Texas, in a course on the Economics of Regulation there was a discussion of LVT in the textbook; I wrote and delivered a speech on it before the class. In a course on the Economics of Money and Banking I wrote a paper on LVT demonstrating the inflationary effect of the unearned increment gained by land speculators. Continuing with additions to the article I wrote concerning implementation in the following:

DAB (talk) 17:58, 13 February 2008 (UTC)

The following may be used as a synopsis or foreword or a summary. It was first used as the conclusion to part on implementation. DAB (talk) 15:29, 20 February 2008 (UTC)

Synopsis

LVT has been controversial since its inception, which traces back to the beginnings of human history. Biblical patriarchs practiced it voluntarily. The creator, YHWH expressed it in the Laws of Heaven given to Moses on Mt. Sinai, promising prosperity to those who practiced it faithfully which is still attested to by those who do. The rational thinker understands it as a matter of common sense. There appears to be something mystical or magical about it that can hardly be explained by Science alone - it is as if it were a matter of Art if not Religion. To be valid the premise must first be accepted in good faith with an open mind, objectively.

Implementation is hindered by conflicts between academic empiricism and logical deduction. Some empirical evidence may be gleaned from the above mentioned cities and countries; still the idea was first and is still readily understood intuitively. The modern idea of LVT was based on a study of the economic effects of the Biblical Tithe, i.e., the payment of 10% of the product of land use in crops and cattle. LVT would extend this principle to the value of land use in building facilities for human habitation. How much greater is the taxable value of land in a city compared to the country? The answer is obvious as the tax collector will confirm - the larger public revenue would be derived from urban land. The burden would first be felt by owners of vacant land where the assessed value is far below its market value. Shifting the tax to land can reduce the tax on buildings without decreasing revenue. Everyone would eventually pay a tax based on the value of land only. Since urban land is the most lucrative source of revenue from LVT, current implementation is done by manipulating the existing two-rate property tax system.

DAB (talk) 17:42, 6 February 2008 (UTC)

Corrected by DAB (talk) 17:34, 12 February 2008 (UTC)

DAB (talk) 18:42, 20 February 2008 (UTC)

Sorry, I didn't realize you were actually planning on putting this in the article. I don't think we can include this:

• It's a very pro-LVT POV,
• The references are unacceptable:
  • Search engine results are not a reliable source,
  • Using external links to Wikipedia is only recommended when the subject is Wikipedia itself,
• This all seems to be original research.

--Explodicle (talk) 16:05, 21 February 2008 (UTC)

Urban land (2)

I took out this section and have placed it here, because I really don't understand why it would come under Implementation.

"The original idea was based on a study of the economic effects of the Biblical Tithe,

• [7]
• [8]
• [9]

• [10] i.e., the payment of 10% of the product of land use in crops and cattle. LVT would extend this principle to the value of land use in building facilities for human habitation. How much greater is the value of land in a city compared to the country? Therefore the larger revenue would be derived from urbanized land use. The first people to lose would be those who hold land out of production only to force up the price for resale - which they are currently able to do where the assessment of land is far below its market value shifting the tax burden mainly to the home or other building owner; LVT would reverse and equalize this burden so that all citizens would pay a tax based on the value of land only. The land tax would encourage the most productive use of land, i.e., its highest and best use.
• [11]
• [12]

70.22.67.251 (talk) 21:41, 30 January 2008 (UTC)

Corrected by DAB (talk) 16:37, 12 February 2008 (UTC)

Cleaning Up, Organizing, NPOV, etc

I've tried over the last couple of days to clean this site up.

1. more logical headings

2. more academic references

3. an attempt to make this more NPOV, I'm still not sure what to do with alleged disadvantages such as hurts farmers, or "ability to pay (aka the poor land value rich widow who is income poor) -- when these arguments don't actually have seem to have empirical support, that is locateable from any sort of literature review.

70.22.67.251 (talk) 17:45, 1 February 2008 (UTC)

I noticed that you took down the cleanup tag. Since there is still debate as to whether or not the article is of satisfactory quality, please leave the tag up until we've reached a consensus here. --Explodicle (talk) 17:44, 4 February 2008 (UTC)

Except Mr. "rule follower", the guidelines say:

"All users are welcome to help in editing or fixing any page on these lists. Please remember to take the appropriate tag(s) off the page when you have completed cleaning an article."

So I think that the etiquitte is that if you think it is not cleaned-up enough, you should say why you think so with some specificity, rather than just put the tag back up. Otherwise that sort of like vandalism, isn't it?

70.22.67.251 (talk) 18:09, 7 February 2008 (UTC)

For example, here I moved some external links out of the main body of the article. It's just as much effort for me to improve articles as it is to list problems with them, so I'd rather do the former. Feel free to take a look at the manual of style if you're unclear about what needs fixing.

As a sidenote, I'd appreciate it if you didn't accuse me of vandalism without evidence of bad faith. --Explodicle (talk) 20:24, 7 February 2008 (UTC)

First, as to the accusation of vandalism: note the words I used. I asked a question. Unlike, the direct accusations against me which include a 24 hour block.

69.250.30.31 (talk) 13:24, 10 February 2008 (UTC)

Note that I didn't say you accused me of anything. I just said what I would appreciate. :-D --Explodicle (talk) 18:58, 10 February 2008 (UTC)

Second, that edit you made make sense. The question is why should the clean up tag still be there. I think it should be removed.

69.250.30.31 (talk) 13:39, 10 February 2008 (UTC)

A third opinion on the matter has been requested. --Explodicle (talk) 19:03, 10 February 2008 (UTC)

Before I provide a third opinion, can Explodicle please specify why the article still needs cleaning up? Thanks. Billscottbob (talk) 05:32, 11 February 2008 (UTC)

A few examples, I can provide more if needed.

1. In some areas such as "Claimed Advantages" and "Claimed Disadvantages", the article does not contain many wikilinks to the subjects discussed or sufficient sources.
2. Several instances of incorrectly cited sources, such as "A Markov Chain Monte Carlo Analysis of the Effect of Two-Rate Property Taxes on Construction" being mentioned two places in the article with a full callout and also being in "References". Other times the article says to see a reference like in "Neutrality of Land Value Tax inconsistent with other claims" without directly backing up associated statements in the article or stating what part of the reference is being cited.
3. The article has many very short sections, well under the recommended 80 words.

--Explodicle (talk) 14:52, 11 February 2008 (UTC)

1. Are there limits to the perfection sought? In comparison to other tax related articles this seems pretty well documented.
2. There is obviously a style of citation format issue but you can't expect minutia of individual pages can you? See, also below.
3. This is is an interesting criticism. In some instances it would require regurgitated wikipedia pages within wikipedia pages. For every rule, I think that there are legitimate exceptions.

70.22.67.251 (talk) 22:12, 12 February 2008 (UTC)

In my experience, {{cleanup}} is used when the issues are blatantly obvious. In an article like this, it would be more useful to use more specific tags. And if a specific section needs cleanup, then you should put the cleanup tag on that specific section. For example, the sections you feel need to be expanded could use {{sectstub}}. For the sections that need more wikilinks, use {{wikify}}. For other more specific templates have a look at WP:TMC. For tags relating to sources have a look at WP:CTT.

In conclusion, I think that the cleanup tag should be removed, but replaced with more relevant tags. Billscottbob (talk) 00:17, 12 February 2008 (UTC)

Ok, thanks for the help! --Explodicle (talk) 01:43, 12 February 2008 (UTC)

May I also suggest that instead of using {{unreferencedsection}} in short sections you use {{fact}} in the text beside facts that need citation and {{refimprove}} at the top of the page. For other inline tags see Wikipedia:CTT#Inline. Otherwise, job well done. Billscottbob (talk) 02:36, 12 February 2008 (UTC)

That all sounds very sensible. Thanks, BillScottBob. You too, Explodicle. -- Derek Ross | Talk 04:19, 12 February 2008 (UTC)

I don't understand the meaning "original research"? tag in this section.

If the Land Value Tax is neutral, then it should neither cause land to be used more efficiently nor used less efficiently. See, Schwab and Oates (1997) but compare Plassman and Tideman (2000)[original research?]

If you look at the list of references you'll see the Schwab and Oates (1997)and the Plassman ad Tideman(2000) peer reviewed papers. S&O claim that land value taxation is completely neutral but P&T's empirical study suggests that land value taxation leads to economic activity (i.e. more construction as measured by building permits and value of building permits.) S&O would claim that it is the decreases in the improvement tax that is the caused of the increased economic activity, but P&T directly formulated their study and its conclusions in term of increases in land value taxation. This is just an ongoing academic debate that has not been settled. (Perhaps because nobody really cares but that would be a POV.) 70.22.67.251 (talk) 22:03, 12 February 2008 (UTC)

• Do the references point out this inconsistency? (I haven't read them) If we're making our own conclusions based on what we've read, that's OR. If it's a conclusion that the references have come to themselves, then we should lose the OR tag. --Explodicle (talk) 16:06, 13 February 2008 (UTC)

How come Regressive_tax does have all of these tags. Talk about lack of citations. 70.22.67.251 (talk) 22:15, 12 February 2008 (UTC)

It might help if you cited it using more detailed footnotes. Also, expanding the section to mention that it is an ongoing academic debate would be helpful. Billscottbob (talk) 00:29, 13 February 2008 (UTC)

Is my writing so obscure that the plain meaning is unclear. Assume a wiki article has this

Pros:
   Cite1 says A has no effect on B (claimed advantage 1)
   Cite2 says A has a direct positive effect on B (claimed advantage 2)

Cons:
   Claimed advantage 1 is inconsistent with claimed advantage 2 cf cite1 with cite2

This is no different than what I wrote. I've read the articles. And talked to the authors. They are cited so that anybody can look them up. What is the problem? 69.250.30.31 (talk) 01:34, 14 February 2008 (UTC)

Your reasoning is perfectly clear. However, this article is not the place for you to publish your reasoning. From WP:OR:

"Articles may not contain any new analysis or synthesis of published material that serves to advance a position not clearly advanced by the sources." (emphasis mine)

If you can show me where a reliable source outside of Wikipedia points out this conflict, then we'll be in agreement. --Explodicle (talk) 14:38, 14 February 2008 (UTC)

This is not "new analysis" nor is it reasoning peculiar to me. It is simple a statement of a conflict in the research. I'm offering no opinion as to who is right or whether the conflict can be otherwise harmonized. 70.22.67.251 (talk) 18:15, 15 February 2008 (UTC)

Prove it. What reliable source has made this simple statement? --Explodicle (talk) 19:35, 15 February 2008 (UTC)

OK, I have found a reliable source that actually says what seems self-evident to me. Coughlin writes at p 266 of his 1999 law review article:

... "there is a debate as to whether increasing the tax on land increases the incentive to build [i.e. use land more efficiently]. Those arguing that an increase in land value tax increases the incentive to build have tow main arguments: 1) A lack of liquidity forces owners of undeveloped land to develop so as to realize an inceome stream to pay the tax; and 2) land value taxation encourages development by penalizing land that is not developed. (footnote omitted) The first argument is problematic. It ignores the possibility that land owners could have access to cash reserves either by borrowing against the land or by selling the land. (fn omitted) Furthermore, empirical studies have not supported the "liquidity effect" argument. (fn omitted) THe second argument does not recognize that land value taxation places the same penalty on developed land as it does undeveloped land -- i.e., improving a parcel of land will in no way reduce the tax on the land. (fn omitted) However, Nicolaus Tideman argues that, given perfect markets, a land value tax will not chinge the timing of land development but contends that to the extent there are market imperfections, a land value tax mitigates them and generally improves economic effeciency. (fn omitted)

—Preceding unsigned comment added by 70.22.67.251 (talk) 22:27, 22 February 2008 (UTC)

Here is another example of not understanding the tags. Someone adds a tag citation needed to the Moritz 1935 bill. I have the year and the bill number. (In fact, I have a copy of the bill from the Library of Congress obtained via my Congressman.) What more stinking citation does one need than the year and bill number?

perfection is the enemy of the good. voltaire

69.250.30.31 (talk) 01:39, 14 February 2008 (UTC)

Would you please post a link to the bill? I'm having trouble finding it, and there's a good chance other people will too. --Explodicle (talk) 14:58, 14 February 2008 (UTC)

Your link is for the 109th Congress, but the Moritz bill is from 1935! Which is the 74th Congress. The bills from back then are not online. 70.22.67.251 (talk) 18:15, 15 February 2008 (UTC)

Ok, I'll take your word for it. Of course, if you want to be super cool and awesome you could copy it to Wikisource and we could cite that, but depending on the length of the bill that might be a lot of work. --Explodicle (talk) 20:51, 15 February 2008 (UTC)

LVT's advantages examined

Economically neutral

It is stated that the LVT is economically neutral, however this cannot be true as it is also stated that "the only direct effect of LVT on prices is to lower the market price of land". Furthermore, it is later stated that "the necessity to pay the tax obliges landowners to develop vacant and under-used land properly or to make way for others who will" also contradicting the neutrality of the LVT. If people are encouraged to do something then that thing is not neutral as its existence admittedly affects economic activity. To put it another way, if it did not exist, people would be less incentivized to market the land. Economically efficient perhaps.. neutral? Hardly.
Also, I would dispute that the price of rents would remain the same with and without LVT (ie. that LVT is neutral on rents) since an expense affecting all landlords at once will necessarily modify market prices. Same as if the price of raw materials went down dramatically for all house builders, average prices would go down as builders compete for customers. The notion that "market land rents depend on what tenants are prepared to pay rather than on the expenses of landlords" is preposterous. Whether or not this is the case, IF expenses in fact are NOT a factor.. then how come the LVT is any different from other taxes incurred by the landlords?
All arguments in this section are utterly and blatantly fallacious.

Unimproved land valuation

The unimproved land concept usually is not relevant to the LVT. When a plot of land is being sold it is usually already transformed in some ways. Flattened, fenced, deforested and perhaps with buildings on it.
Buyers will have to take that into account as they will either want to destroy the buildings (costs) or keep them (free gift?), both of which will affect the price that person is willing to pay for the land. You simply cannot dissociate both and different buyers will have different needs. This idea holds true with the land, which no longer comes as it were originally but is now transformed in some way which the buyer will find beneficial or not. Those transformations and buildings all affect the purchase price.
You cannot know what the buyers were willing to pay for the UNIMPROVED (ie. in its original, natural state) land for at least 4 reasons:

• we do not necessarily know what it was like
• we do not know what people would have paid for it as this is not what is being sold. Property appraisers must necessarily come up with an arbitrary value (which incidentally always includes, at the very least, current land alterations).
• different people will be willing to sell and buy at different amounts at different times assuming they make the sale in the first place.. this maximum price goes up and down constantly and cannot be known by property appraisers especially if no sale is taking place
• all things being equal, a small downtown forested plot of land will be valued less that a nearby deforested (ie. labor) plot of land.. will both be taxed based on the forested plot of land value?

Fairness and justice

In reality land acquires a scarcity value owing to the competing needs of the community for living, working and leisure space. Thus the unimproved value of land owes nothing to the individual efforts of the landowner and everything to the community at large

It does not follow. The value does not go up because the community wants to use it but because a number of buyers do.
Also, there is a huge problem with this concept. It essentially says that because the community gives value (ie. has needs for a scarce resource) to the part which was not man made, its value belongs to the community. Shouldn't we also tax raw building materials, free energy from the sun and other parts of the planet? EVERYTHING that is usable to man comes from free gifts of nature. EVERYTHING is therefore subject to some level of taxation, including buildings.. LVT proponents essentially decide to arbitrarily stop at taxing land.
As we have seen above, the unimproved value concept is moot in the first place, but even then, the unimproved land (which again, is not what is being sold) wasn't created by the community either, nor is its value.

Then there is the concept of "community" itself. Since fairness and justice are what is being examined here:

• is the bum on the street to be partially credited (as part of the community) for rising land values?
• is the new employer in town not to be?
• should both be credited equally then via the so-called community?

How bizarre and unfair that individuals from the community do not even get to decide for themselves what to do with their portion of the LVT.

• why would a landowner who was directly responsible for improving land values in his immediate surroundings be taxed more as a result of his efforts? (assuming his actions made all surrounding land, including his own more desirable to the community)

My question is: is it appropriate for me to edit the article itself to debunk these points in the disadvantages section?

IWantToLiveFree (talk) 14:52, 15 February 2008 (UTC)

That sounds fine to me, just remember to cite reliable sources. Even if your reasoning is flawless and objective, we shouldn't have any original research or analysis. --Explodicle (talk) 16:21, 15 February 2008 (UTC)

Explodicle, this is precisely why I asked. I figured people would want references but I am not a regular Wikipedia contributor, even when I disagree I usually limit myself to correcting the spelling and such :)

I only have one reference to provide and it doesn't necessarily cover everything I said here. Logic is what I used. The unfortunate truth is that the LVT myths are very easy to debunk with simple common sense so that's what I used here.

It's a shame readers will only be exposed to these so called advantages all the while reading weak and inconsequential disadvantages (which are obviously written by propponents of the LVT with rather biased language).

IWantToLiveFree (talk) 19:33, 15 February 2008 (UTC)

That's why I tagged a lot of it as POV. I think the only way we can fix this problem is by improving the "arguments for" sections, rather than adding more stuff (the article is already getting kinda long). Other than that, we'll have to let the reader make their own decisions based on the evidence. --Explodicle (talk) 17:10, 18 February 2008 (UTC)

Claimed disadvantages

Loss of asset value

Land value is the discounted present value of expected future after-tax rents; so LVT, by increasing the taxation of those rents, would reduce the value of all real estate owners' holdings. A rapid reduction of real estate values could have profoundly negative effects on banks and other financial institutions whose asset portfolios are dominated by real estate mortgage debt, and could thus threaten the soundness of the whole financial system. Rapid introduction of LVT must therefore be considered a somewhat irresponsible approach*[13], and most LVT advocates consequently favor a long phase-in process lasting at least a decade, and potentially much longer. However, if by the power to regulate commerce among the several States delegated to Congress by We the People, commercial use of the land supply were regulated by the Federal Reserve Bank; and if by the power of eminant domain reserved to the States the LVT tax-rate were regulated by the State Banking system, this problem should be resolved.

If land's value were reduced to zero or near zero by recovering effectively all its rent, as LVT economists*[14] say is possible, total privately held asset value could decline by as much as 1/4 or even more, a massive reduction of private sector wealth; however, if a more equitable distribution of land and wealth is the result it could be justified and accepted in the long-run.

DAB (talk) 16:41, 15 February 2008 (UTC)