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I have yet to understand why people have made land value tax a thing. As I understand it, land value and improvements are already taxed but a land value tax would only tax land value. Can someone make this make sense? Why would this promote development?
The classic example is the lot that sits empty or has a parking structure on it in Manhattan. Today, you pay very little tax on the empty land or parking lot because you’re taxed on that total value of the land and improvements. This discourages building stuff sometimes. With land value tax, you’d be taxed on what someone would pay you for that land with improvements similar to surrounding, so it’s advantageous to bu…
If you're being taxed on hypothetical improvements and not just the value of the land, why is it called a Land Value Tax, rather than a Hypothetical Best Use Tax? People assume the name means what it says and get confused.