I think LVT does have a history in US, e.g Pittsburgh.
Also Georgism is 100% LVT -> A land tax alone has been the recommendation of many economists before and after George - From Smith, Riccardo, Mill to Friedman. Across classical, neoclassical, Keynesian, Austrian schools. If there's one thing economists can agree on, it's that land tax is better than income tax.
There was also a community in the deep south. And I once read a case study about a town that tried it in, IIRC, New Mexico.
Full LVT never works. It always ends up shot through with exceptions and loopholes and, in the case study, inducing corruption. And it's all predictable, too, if you know anything about taxation policy and American political culture. For full LVT you'd need to start from a blank slate, not just from a legal perspective but from people's expectations about property ownership.
An analogy just occurred to me. Imagine an income tax not on what you currently earn, but on what you could earn given your schooling, credentials, experience, etc, and the available jobs within your region. Imagine how utterly unfair people would feel about that, and how quickly such a scheme would fall to widespread political pressure.
I get why an LVT makes sense from an economic perspective, but in practice it feels nearly as unfair as the above. Residents especially, but small and medium sized businesses would very quickly lobby to eviscerate an LVT. Imagine long-time residents getting kicked out not because a developer wants to make buck, but because the tax system requires that to happen.
There's zero chance such a scheme could survive intact politically. In Pittsburg it's an LVT in name only, with a long list of exceptions and curious appraisals. And once it's applied ad hoc, which it must, there's all manner of distortions and incentives for corruption.
There are many ways for land use and tax policy to improve, but you have to come at from the perspective of improving the existing system, not revolutionizing it with an LVT. And you could probably get closer to an LVT by smart incremental reform than you could by trying to nominally pursue an LVT.
Not sure if you realize this, but most businesses and nearly half of residents pay exactly such a tax. It's called 'rent' and is based on a 'market rate' which is exactly the amount that could be earned. They get kicked out all the time! That's actually what created the political demand for LVT!
You even pay rent when you buy a house. The value of the land is the market expectation of the value of future rents.
You can have a less than 100% LVT to get some of the advantages without upsetting the apple cart. Common in many jurisdictions.
skew-aberration · · focus · HN ↗
Also Georgism is 100% LVT -> A land tax alone has been the recommendation of many economists before and after George - From Smith, Riccardo, Mill to Friedman. Across classical, neoclassical, Keynesian, Austrian schools. If there's one thing economists can agree on, it's that land tax is better than income tax.
wahern · · focus · HN ↗
Full LVT never works. It always ends up shot through with exceptions and loopholes and, in the case study, inducing corruption. And it's all predictable, too, if you know anything about taxation policy and American political culture. For full LVT you'd need to start from a blank slate, not just from a legal perspective but from people's expectations about property ownership.
wahern · · focus · HN ↗
I get why an LVT makes sense from an economic perspective, but in practice it feels nearly as unfair as the above. Residents especially, but small and medium sized businesses would very quickly lobby to eviscerate an LVT. Imagine long-time residents getting kicked out not because a developer wants to make buck, but because the tax system requires that to happen. There's zero chance such a scheme could survive intact politically. In Pittsburg it's an LVT in name only, with a long list of exceptions and curious appraisals. And once it's applied ad hoc, which it must, there's all manner of distortions and incentives for corruption.
There are many ways for land use and tax policy to improve, but you have to come at from the perspective of improving the existing system, not revolutionizing it with an LVT. And you could probably get closer to an LVT by smart incremental reform than you could by trying to nominally pursue an LVT.
skew-aberration · · focus · HN ↗
You even pay rent when you buy a house. The value of the land is the market expectation of the value of future rents.
You can have a less than 100% LVT to get some of the advantages without upsetting the apple cart. Common in many jurisdictions.