Thread: New, simplified geoist-style tax code..

If we eliminated all 3 of the income and sales and corporation taxes and replaced it with progressive land taxation (such that less total taxation happened but it was shifted towards discouraging greedy land occupation), what does your little mind think would be the advantages and disadvantages of that?

My little mind thinks that assuming the tax were to remain revenue neutral relative to today's tax
and assuming that there was an accurate way to measure the value of any particular piece of land,
that such a thing would lead to a more efficient utilization of the scarce land resources and therefor more overall productivity,
I think that it could gradually start to slow down the increase in the wealth gap, perhaps even reverse it,
I think that taxes overall could be made simpler simply by having fewer taxes,
and I think that the income, sales, and corporate taxes would not be missed.

I don't think there would be any inherent dangers in a land tax that aren't already present in today's taxes.
I don't see how removing general taxes on income, sales, and corporations would add to the risks,
if such taxes are replaced and assuming they weren't specifically intended to discourage a particular activity.
I think the success of land tax would largely depend on the level of progressiveness, and more importantly, our ability to accurately assess the value of land.

-Meta

Originally Posted by DeathStar

If we eliminated all 3 of the income and sales and corporation taxes and replaced it with progressive land taxation (such that less total taxation happened but it was shifted towards discouraging greedy land occupation), what does your little mind think would be the advantages and disadvantages of that?

Here, read and learn:

http://papers.ssrn.com/sol3/papers.c...act_id=1103567

Why does DeathStar keep getting banned? O_o

Originally Posted by DeathStar

If we eliminated all 3 of the income and sales and corporation taxes and replaced it with progressive land taxation (such that less total taxation happened but it was shifted towards discouraging greedy land occupation), what does your little mind think would be the advantages and disadvantages of that?

Replacing all taxes with one national land tax has many advantages. Especially if there is a high tax on capital gains that is linked to land sale.

< crude example alert >
Today, if someone buys a piece of land and just sits on it, then they can sell it at a higher price later. That person has made money and has contributed nothing. Buy making real estate investment unattractive, then, people will have to put their money into more productive investments like a small business.

Financial investment in Wall Street will sour. No more capital gains or taxes on dividends. No more double taxation.

Productive efforts will be rewarded. Today's tax code punishes success. The more you make, the more you owe in taxes. A national real estate tax is similar to a flat tax. The more money you make, the lower the tax you owe. You basically incentivise the eoconomy to make more and more money to help pay off that tax bill. That's off course if you own land.

People who do own land will try to squeeze out as much value as they can out of the land. A well developed piece of land will earn more money. So people will want to develop their land so they can earn money and pay the tax man.

Government will want to own less land. The more land the government owns, the less income for them. So they will want to privatize as much as possible so people can start paying taxes.

A tax on land is a good idea. But today's taxes is a political football that no politician wants to give up. By gaming the system, politicians use the tax code to bring home the bacon which means political contributions go up. I don't see you can do that with a real estate tax.

That says it all. A model for total failure based upon land distribution. The USA will soon be a total failure for an analogous process (the Affordable care act, i.e. "Obamacare"). A land tax is simply another socialist/communist attempt to make farmers pay for people that are stealing from the pot (i.e. lawyers primarily along with government officials).

Disadvantages: Those who have skills with regard to farming have no incentive to do anything because the profit margin has been decreased.

Advantages: None.

Originally Posted by dudeman

That says it all. A model for total failure based upon land distribution. The USA will soon be a total failure for an analogous process (the Affordable care act, i.e. "Obamacare"). A land tax is simply another socialist/communist attempt to make farmers pay for people that are stealing from the pot (i.e. lawyers primarily along with government officials).

Disadvantages: Those who have skills with regard to farming have no incentive to do anything because the profit margin has been decreased.

Advantages: None.

Obviously you know nothing of economics.

Replacing other taxes with a land value tax would increase the profit margin of farming.

Land value taxation would decrease the profit margin of landownership…but many farmers don’t own the land they farm and would be far better off with the abolishment of other taxes.

Land value taxes do not discourage farming or any other activity. That is why so many great economists have endorsed the tax -- it is the only tax that doesn’t distort the economy, it doesn’t raise consumer prices or reduce producer profits -- it just makes land cheaper to purchase. Cheaper land prices and fewer taxes makes it easier for people to enter into the farming occupation.

Originally Posted by dudeman

Disadvantages: Those who have skills with regard to farming have no incentive to do anything because the profit margin has been decreased.

Wait...That doesn't make any sense,...
Wouldn't there be more of an incentive for them to use their skills to be as productive as possible so as to better pay for the land they hold, or to sell it away to someone who needs it more and or to someone who is better able to use it for productive purposes?

It seems to me that the big disincentive of a progressive land tax is to people who hold large quantities of land and don't use it to produce anything.

-Meta

you don't understand the concept of "inheritance". Many landowners inherit land and a tax imposed upon that land above and beyond the outrageous "property taxes" (i.e. education unions primarily) would be a burden to those that have land and grow food. Why not tax wealth and income? Or would that redistribute some of YOUR wealth?

I'm not against a wealth tax and I actually think an overall wealth tax would be preferable to a pure land tax only system, and honestly I'm not against an income tax either though I think that it would be unnecessary if either a wealth tax or a progressive/tax neutral land tax were to replace it....

But why/how exactly would a land tax disincintivise people from farming?
And what exactly does inheritance have to do with it???...

-Meta