Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Why a land-value tax is inevitable

medium.com

Post reply on HN
Print view View original

141–150 of 322 posts

Re: Why a land-value tax is inevitable

#141

Post by Ericson2314 »

AnthonyMouse wrote: post #56
Ericson2314 wrote: post #8

Earlier quoted context omitted.

> For a $1m house in the Bay Area, only a quarter or a third of that value is the structure. So the first problem is zoning, but imagine if zoning is fixed. Now the taller the building is, the smaller the portion of the taxable value derives from the land itself. The fact of the matter is single family suburbia is a scourge, and we need redevelopment not more development. We can subsidize affordable housing, or we ca…

> So the first problem is zoning, but imagine if zoning is fixed. Now the taller the building is, the smaller the portion of the taxable value derives from the land itself. Which is sort of the problem, right? You have an area which is, say, two story buildings, in an area where you really need an average of three story buildings to satisfy local demand. Implement LVT and everyone gets the bright idea to build twelve…

> It seems obvious that this only works if the amount of the land tax isn't large enough to cause these behavioral changes.

It's about the speed of the transition to LVT, not the stateless amount of LVT.

> But then you get the opposite problem. Real estate prices crash, because there are suddenly twelve story buildings going up everywhere and the prices need to fall to the level that building more of them isn't viable even against the tax advantage. Which is well before you're saturated with tall buildings.

Only if the LVT goes up to quick. Because the value of the land depends on the improvement to adjacent land, we can think of human building as a puddle of liquid that LVT makes more cohesive.

If we crank of the cohesion too quick, we get tiny beads of liquid everywhere, you scattered 12 storey buildings, and no walkability. It's just a modernist landscape.

If we grank of the cohension slowly, we get bigger beads, i.e. new manhattens as the surrounding suburbia is drained. This is exactly what we want.

The increased density itself creates more derived value, and so a big crash is unlikely.

Re: Why a land-value tax is inevitable

#142

Post by paconbork »

throwaway201103 wrote: post #101
paconbork wrote: post #21

Earlier quoted context omitted.

Charming bakery with five stories of apartments above it > charming bakery by itself

Bakery in a retail slot in the ground floor of a 5-story apartment building is by definition not charming. It's cookie-cutter (pardon the pun). It's the sort of place that opens, struggles for nine months, and goes bankrupt. We see so much about wanting "walkable" neighborhoods where we have shops and markets all steps away from our door. Well, if the land is so valuable that it will only support dense apartment towe…

As a counterpoint, Manhattan has plenty of charming street-level shops in an area where multi-story apartment buildings are the only reasonable thing to build.

Re: Why a land-value tax is inevitable

#143

Post by throwaway201103 »

mullingitover wrote: post #108
throwaway201103 wrote: post #88

Earlier quoted context omitted.

The argument against it is that a vacant property imposes very little cost upon society. It doesn't require fire protection, it doesnt add children to the education system, it doesn't use any municipal resources. If it's an eyesore or presents a hazard in some way, sure, but simply being vacant or "underutilized" doesn't do that. Why should it pay to simply exist?

The vacant lot in the middle of Manhattan has a massive opportunity cost to society. If you goal is to own a vacant lot and you don't care where it is, trade that vacant lot in Manhattan for another one in rural Alabama.

The apartment tower also has massive costs. It requires high-capacity water, sewer, electric, and trash service. It requires specialized fire protection services including extra training and equipment to fight fires in high rise buildings. It has a massive carbon footprint.

Why should a property owner who does not impose any of those costs (or imposes a tiny fraction of them) pay equally for them?

Re: Why a land-value tax is inevitable

#144

Post by bryanrasmussen »

thebradbain wrote: post #62
bryanrasmussen wrote: post #37

Earlier quoted context omitted.

Perversely, if it was based on what the value of the property would be without any building on it, in lots of popular areas it would be more than the cost of the property tax because people will pay a premium for land where they can build what they want if the area is popular. So I guess it can't be that way, as it would piss a lot of people off.

LVT, in its most pure form, isn’t based on any improvements (or lack thereof) to the land — the tax would be based purely based on the land itself, as if the home were NOT there. Most likely, it would be heavily based on zoning, neighborhood, and proximity to jobs and transit. Take Los Angeles, for example. I would imagine you could actually see taxes in predominantly SFH enclaves like Calabasas or Malibu 1hr+ from j…

So, you're saying it is the way I described but thought must be wrong?

Re: Why a land-value tax is inevitable

#145

Post by wmf »

throwaway201103 wrote: post #137
wmf wrote: post #112

Earlier quoted context omitted.

It imposes the cost of pushing people farther away from each other. Every block that's empty is one block farther people have to walk/cycle/drive to get where they're going.

So you'd be in favor of plowing under Central Park and covering it with apartments towers so that everyone could be closer together?

Central Park isn't empty land; it's in active use. Also, I think an argument could be made that Central Park generates enough (intangible) value to cover its LVT. When the government pays tax to itself it nets out to zero anyway AFAIK.

Re: Why a land-value tax is inevitable

#146

Post by mlinksva »

Plainly not inevitable. Crises can continue to get worse instead, and surely that's much more likely.

However, I'd love to be pleasantly surprised, and occasionally am, e.g., apparently Baden-Wurttemburg (the German state that includes Stuttgart) has recently passed a LVT scheduled to be implemented in 2025 https://libdemsalter.org.uk/en/article/2020/1382897/germany-...

Re: Why a land-value tax is inevitable

#147

Post by jdc »

fastball wrote: post #71
lend000 wrote: post #58

Earlier quoted context omitted.

Change Carbon tax to "Pollution tax" -- even on the topic of global warming, methane and nitrous oxide are potentially more harmful, and a pollution tax is far more future proof for capturing externalities.

*pollution tax that can be reduced to zero if you are capturing (not necessarily at production) the pollutant you're emitting. e.g. SpaceX shouldn't be taxed on CO2 release from their Raptor engines if they are getting all their methane via the Sabatier process.

I'm sure they'd get capture credits.

Re: Why a land-value tax is inevitable

#148

Post by pydry »

Ericson2314 wrote: post #78
kashkhan wrote: post #48

Earlier quoted context omitted.

Add MMT to the list. LVT is good for state governments that don't have their own currency.

Modern Monetary theory is theory not policy. The jobs guarantee that goes with it I really don't like. It's stupid in 2020 to not be trying to reduce the total labor per person. Sure, some infrastructure projects are really important, not profitable, and might even require the training of new labor to get it done. They should definitely still happen. But I see no good reason to hitch that to jobs guarantee.

The most convincing argument for job guarantee over UBI I saw was plan jefes in argentina.

It started out as a job guarantee, where women were given jobs as caregivers and got shifted to UBI where the women were told they didn't have to do the jobs but they'd still get the money.

They still did the jobs when they didn't have to. They said it provided them with a social network and social interactions and most importantly, with purpose.

One of the things that bugs me the most about UBI is the idea that people would rather just laze at home and do their own thing given the chance and the money to make that possible. I don't believe that's true. I think humans have a deep seated need to be part of a community, to have purpose and to leave a mark.

The new deal was a spectacular illustration of that. The people who took part in public works projects were justifiably proud of what they'd done - building bridges, art works, schools, sewers, streets and more.

Re: Why a land-value tax is inevitable

#149

Post by Spooky23 »

paconbork wrote: post #131
Spooky23 wrote: post #111

Earlier quoted context omitted.

That’s why LVT will never happen and is a dumb idea. If a freeway exit gets built a block away from my house, my taxes will reflect the value of a Walmart or whatever instead of my house.

In which case you should sell your property and make bank on what Walmart would be willing to pay for it. (If you wouldn't make bank then your taxes wouldn't be prohibitively high)

Why would Walmart make a deal when they could just wait for or lobby the county to valuate your land at some excessive value and force a sale in distress?

LVT is just bad policy that sounds ok in concept. In my city, inner city residential property is near worthless once it falls below section 8 standards. The taxes are low too as result. With a LVT scheme, someone would cook up some “true” value subjectively, which has obvious potential for abuse.

Re: Why a land-value tax is inevitable

#150

Post by mr_cyborg »

notahacker wrote: post #70
mr_cyborg wrote: post #16

I’m struggling to envision how this would impact homeowners differently than the current property tax paradigm. If I have a house and the value of the property goes up, my property taxes increase. If I were to sell a house at market rate, theoretically it would be reflective of what rate it was being taxed at. How would this same situation play out with a land-value tax?

Theoretically with an LVT, if the value of the property goes up because you restore and extend it or convert it into a dozen flats the tax stays the same (but still increases if the value increases because youre lucky enough get a good school and a light rail station in the area as the result of others' actions). In practice, it's somewhat difficult to separate the two which is why property taxes are more common (als…

Thank you for your response.

I feel like homeowners may become more resistant to city services and improvements in their area if it will impact their bottom line disproportionately. I guess it would come down to the value formulation.

Post reply on HN