The term ‘unimproved land value’ is widely employed in much writing on LVT, but can be misleading. What is intended is to make the distinction between a site that has been developed or built upon (improved) and a vacant site where no apparent development has taken place (unimproved).  The problem with this term is that it leaves unresolved various anomalies that might arise when trying to establish the actual meaning of ‘unimproved’ for the purposes of taxation.             Continue reading

Politicians are always averse to any change in taxation that will create losers who will cost them votes, so they tend to resort to indirect taxes where no obviously disadvantaged group can be identified. Although any change to LVT would create winners and losers, in any part of the economy where land was involved, it is arguably the effect on homeowners that would give politicians most concern.      Continue reading

This expression arose from the time when ordinary homeowners realised that their home did not have value simply as somewhere to live, but also as an investment. It became evident that constantly increasing property values, reflected in house prices, provided, over the long term, a better return on capital than savings accounts, and at the same time a place to live. Paying rent when you could be paying off a mortgage did not make sense to most people.                       Continue reading

As with any commodity, it is the combination of the price demanded and the financial means of the prospective buyer, that renders it affordable or not.  Housing is no different. House prices have been rising inexorably at least since the 1960s and continue to do so, especially in the most sought after areas, such as London and the South East.                       Continue reading

Land banking, also known as land hoarding, is nothing new but has become a more noticeable issue in recent years due to the increasing housing problem, which is seen as largely a matter of supply. House builders complain of the lack of access to––or the excessive cost of–– building sites, as the main reason for their inability to deliver the houses required. The theory is that building is restricted by the high cost of land acquisition––which is reflected in the final price, hence the high house prices.                 Continue reading

1.  Economic Rent Collected in Advance

As mentioned in the basic principles of Part 1, the economic rent of land arises inexorably and is collected by whoever is in control of the land, whether an individual or a government. This economic rent varies according to the productivity on each site, and is known by economists as a ‘differential rent’.                     Continue reading

These are some of the routine objections raised by opponents of LVT:

1. LVT is a form of wealth confiscation.
2. The ‘Poor Widow’ objection.
3. Separate valuation of land would be too difficult.

The following are my responses:                          Continue reading

There would be several formidable obstacles to the adoption of LVT.

1. Resistance from landowners and speculators.
2. General resistance to ‘wealth taxes’.
3. Lack of Understanding of the principles of LVT.
4. Political resistance.
5. Academic resistance.

1.  Resistance From Landowners and Speculators

It is understandable that landowners would resist any system that would reduce the benefits they derive from the collection of the economic rent. LVT would of course divert this collection away from landowners and towards the public purse.     Continue reading

Amongst economists who know about the land value tax, the term is often synonymous with ‘The Single Tax’, for that was seen as the main characteristic in the early days of its manifestation.  In his book, Progress and Poverty, Henry George proposed that the land value tax should be the only tax.  This single tax idea has been identified with the LVT movement ever since, and is still insisted upon by the purists, but in recent years it has been questioned more and more.                 Continue reading

In Part 1, on basic principles, I suggest that it is better to impose taxes on existing wealth rather than the wealth-creation process, and also that in general direct taxes are more honest than indirect taxes (often described as stealth taxes). This item brings these strands together under the question of which taxes might be eliminated, reduced or maintained within a system where LVT plays a significant part.

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