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Tax the Land

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Re: Tax the Land

#71

Post by danaris »

silicon2401 wrote: post #49
danaris wrote: post #45

Earlier quoted context omitted.

> Landlords are not parasites and provide a valuable service. Landlords take property that could be owned outright by the resident and extract, at best, a middleman's fee. Some landlords also provide access to services such as repair, cleaning, etc and combine those fees with the rent, but there is no reason those could not be equally available to owner-residents without the landlord acting as a middleman, and there…

> Landlords take property that could be owned outright by the resident Why do you assume every resident wants to own their property? When I lived in Baltimore you can be damn sure I didn't want to own anything in that city. There are valid reasons for renting to exist, landlords do provide valuable services, and there are people who do want landlords and renting to exist. It's okay to say you personally don't like la…

> Why do you assume every resident wants to own their property?

Actually, I don't. I know that there are people who would prefer not to.

But because of the way the system is set up, it is so trivial and common for landlords to be extremely abusive. I would rather see things changed so that some people who would prefer to rent have to shrug and buy something instead—but actually have that option, because what would have been set up as rental properties are instead genuinely low-cost housing for purchase—than see the system continue as it is now.

I also know it's very unlikely that the status quo is going anywhere, so this is almost entirely a theoretical discussion.

Re: Tax the Land

#72

Post by larsiusprime »

throwaway894345 wrote: post #38
flenserboy wrote: post #23

This would be a great way to destroy (privately held) farms and significantly, permanently raise food prices.

While incentivizing denser factory farms over free range. Similarly, it incentivizes higher-yield GMOs over organic/local. I’ve been seeing a lot of this pro-density stuff pop up and it seems like urbanites trying to solve for urban problems on a national level despite that much of the nation doesn’t have urban problems. See also the various anti-car/everyone-should-bike-everywhere debates.

Have you actually run the numbers? Land value tax would most likely reduce the taxes on most farms, the vast majority of land value is concentrated in urban spaces. The majority of farmland is almost certainly getting a tax break under a land value tax regime, especially if its used to offset existing sales and income tax.

Further, while land value tax would reduce the average tax burden on the average farmer, it would change the incentives because it would make passively holding onto land less valuable of an activity on the margin even if there's a net savings to the average farmer.

I'm not a fan of factory farming either, but the point you're missing is that the kind of agricultural strategy you and I don't like optimizes NOT for highest yield per acre, but highest yield per dollar of input.

Efficiency is not mono-dimensional, it's not about "more efficiency" it's about "more efficient AT WHAT." And what industrial farming is efficient at is not using money and not using human labor. One of the chief ways it does this is externalizing most of its costs (pesticides, herbicides, runoff, erosion, antibiotics, etc), and grabbing up more land to make up for its lower per-acre efficiency.

Re: Tax the Land

#73

Post by boredumb »

andrepd wrote: post #62
boredumb wrote: post #55

Earlier quoted context omitted.

I absolutely do have qualms with the entire organization and find ezra klein to be a snake. The idea that a self proclaimed anarchist who spoke against the state as being an exploitative entity, promoting increased state taxes on land, is amusing until you realize the context of him living in the period of Russian aristocracy.

Anarchist thought has a long tradition of seeing certain things as "commons" which are illegitimately appropriated by private concerns. This includes things as land, air, natural resources, cultural heritage, etc. But more importantly, the part where you speak of "state taxes" makes me think you have no idea what you're talking about, since the original idea of Henry George was to distribute the LVT in the form of a…

If the state is coercing you to pay taxes for the land you live on, it is a state tax. We can all collectively start referring to chickens as horses, we can even refer to aviaries as a prescient form of stables, but it is not going to change the nature of the bird. The naive idea that exchanging all the taxes for a single land tax will result in anything but all of the current taxes with an additional state tax on land is ahistoric to put it kindly.

As of the time of writing we do pay taxes on land as well as taxes on labor, taxes on commerce, taxes on investments, taxes on inheritance, taxes on imports, taxes on value added to goods, sin taxes, tax stamps for government services, taxes on energy, taxes on roadways, taxes on gifts, taxes to enter or leave airports, and even taxes to live in certain cities. In the US these did not exist until after the civil war and since then they've become the rule and not the exception, to repeal all of them and replace them with a LVT is great, but to expect the modern state to not feature creep every single one of the current taxes back in place within a few decades gives me a huge pause.

Re: Tax the Land

#74

Post by Ekaros »

andrepd wrote: post #7

There is something deeply wrong with the fact that you can buy-to-rent a property and immediately turn up a profit, essentially inserting yourself as a parasitic middleman in the process, providing no service, and extracting an economic rent.

Is it deeply wrong that you can go on stock market and buy part of company and immediately turn up profit when they pay dividends. Essentially inserting yourself as parasitic middleman in the process, providing no service and extracting an economic rent... Or doing same by buying existing debt?

Re: Tax the Land

#75

Post by larsiusprime »

boredumb wrote: post #59
larsiusprime wrote: post #56

Earlier quoted context omitted.

Sounds like a testable hypothesis, let's look at the evidence: https://www.gameofrent.com/content/can-lvt-be-passed-on-to-t... The best empirical evidence available shows pretty strong signs that land value taxes are not passed on to tenants

If you save up money and buy a house to rent and your mortgage/interest/tax payment is 1100$ you will be charging 1100$, adding in a % to make sure that any routine maintenance and future renovation costs are covered. If property taxes are raised and my mortgage/interest/tax payment are now 1350$ you will raise rent accordingly unless you are running a charity or expect a roof to repair itself. I don't need a theoret…

> I don't need a theoretical analysis from a game developer who has to imagine himself as a landlord as I have personally owned rental property before, have known people who have owned rental property and rented property before.

Great, because I didn't provide you with a theoretical analysis, I provided you with an empirical analysis that actually looks at the evidence from the real world.

Regardless of my credentials or your credentials, I'm not particularly impressed with anyone who cites an N of 1 from their own personal experience and thinks it proves anything in particular.

Re: Tax the Land

#76

Post by basch »

Ekaros wrote: post #74
andrepd wrote: post #7

There is something deeply wrong with the fact that you can buy-to-rent a property and immediately turn up a profit, essentially inserting yourself as a parasitic middleman in the process, providing no service, and extracting an economic rent.

Is it deeply wrong that you can go on stock market and buy part of company and immediately turn up profit when they pay dividends. Essentially inserting yourself as parasitic middleman in the process, providing no service and extracting an economic rent... Or doing same by buying existing debt?

The dividend payout is priced into the purchase price.

Re: Tax the Land

#77

Post by xboxnolifes »

giantg2 wrote: post #13

"The big question land value taxes help answer is: How can a government raise funds without distorting choices and possibly leaving people worse off? If you tax income, it provides a disincentive to work. If you tax property, it provides a disincentive to improve the physical buildings on top of the land." Of course it will distort choices and leave some people worse off. If the author can't see that, then they have…

> If I have .75 acres with a single family home and 30 years later the area around me is developed, them I will be financially forced off of my land because I could theoretically put an apartment building on it. We already see standard property tax forcing the elderly out of their homes in many areas.

This is one of my current issues with land value tax: pricing out existing residents. One mitigation I think that would help would be only adjusting the LVT of a plot on sale / ownership transfer. It would likely need a bit more nuance than that, as it doesn't quite work with company owned land (doesn't really switch owners like a sfh owner dying).

The land will eventually get more efficient use, but there isn't the recurring threat of being priced out of your home.

Re: Tax the Land

#78

Post by long_time_gone »

bombcar wrote: post #70
mdorazio wrote: post #65

Earlier quoted context omitted.

I'm strongly going to need a source to back up your claim.

Find banks or real-estate companies that invest in single family homes for the purpose of renting them. If you can find one, you often find that they'd rather let the property sit empty than renting it. Or just look at the cost of buying a house vs renting a similar house, account for maintenance, and see if the numbers line up.

This isn’t really a source though, it’s requiring the other commenter to prove the point you made.

Anecdotally, I know people who buy single family homes and rent them for profit. My 3 bed, 2 bath single-family home has a $3,000/monthly mortgage, I could easily rent it for more than $3,500 (closer to $4,000). Take out 10% for maintenance fees, and I net $200 a month.

Re: Tax the Land

#79

Post by rapind »

boredumb wrote: post #41
rapind wrote: post #24

Earlier quoted context omitted.

Subjective. When I used to rent, I never saw my landlord after signing the lease. I was renting a house and taking care of small maintenance issues myself. I'd say it was far less effort to rent to me, then it would have been to live there himself. Of course there are bad tenants, but I suspect, like most things, we focus on those negatives and ignore all the low maintenance tenants when thinking about it.

a new roof is over 20,000$ a new floor in a modest home is over 10,000$ a burst pipe will be over 1,000$ interest payments are thousands a year property taxes are thousands of dollars a year all are guarantees even with the lowest maintenance tenants.

Agreed. Home maintenance, property tax, mortgage interest, is a cost of owning regardless of whether you are renting or living in it. So that needs to always be part of your calculation, and I would hope most landlords are considering that.

I was just hypothesizing that the "Bad Tenant tax" is potentially overblown. Sure it can be an absolute nightmare if you're unlucky (or bad at screening), but on average I suspect it's pretty minor. I honestly don't have anything but anecdotal data to back that up though. I just suspect, like a lot of things where exceptional horror stories are propagated, we could be over-weighting the negatives.

Re: Tax the Land

#80

Post by pyradius »

bitshiftfaced wrote: post #26

In my mind, LVT only works properly when you've ripped out every other tax: income, sales, capital, you name it. Absolutely no more friction and warped incentives. Divide the government budget by the weighted land values and tax accordingly. But that could never work in our world. There would be too much temptation to add a small tax here for this other thing, and then it snowballs, and then we're back to where we st…

If you accept the ATCOR concept (All Taxes Come out of Rent) then the presence of existing taxes diminishes land rent by the amount of those taxes.

You can read more on this subject in Taxation: The Lost History in the following section:

All Taxes Indirectly Fall on Land Values - https://www.jstor.org/stable/43817496?read-now=1&refreqid=ex...

and in the "Trickle-Up Economics" report - https://www.prosper.org.au/wp-content/uploads/2018/04/Trickl...

Of course, we should first replace the existing bad taxes for multiple reasons. Nonetheless, as a matter of economic and social justice, -any- amount of land rent that exists should be publicly collected and distributed on a per-capita basis.

This does not increase the user-cost of land as land has no cost of production. Of course as a transitional issue there will be net winners and net losers (for which we could create policies to address the transitional effects). The ultimate effect of the full public collection of land rent would be to bring the selling price of land down to $0, while the rental value would remain the same (not counting the dynamic effects).

In reality, land value taxation isn't really a tax when properly understood. You either pay a previous owner in selling price or you pay the public the annual rental value. Most people don't properly consider that the selling price is simply the capitalized ability to capture future rents. In an ethical society, this privilege would not exist.

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