High LVT means you pay a high tax on the land itself and little or no tax on what you do on top of that land. It encourages highly efficient land development which means increased supply of commercial and residential units (thus reducing rents), and it makes lots of speculation prohibitively expensive. Since holding undeveloped land is just as expensive as holding developed land, you’re going to want to put it to productive use sooner rather than later.

Thats sounds a solution for undeveloped land in urban areas though REITs are buying up the housing stock which is different.

If I understand your solution correctly it also puts a higher burden on the rest of the population who then have to pay higher land taxes each year (politically unpalatable) and I would argue that REITs probably have more capital to be able to pay off higher taxes where cranking up land taxes on the population makes home ownership more challenging.

They are fundamentally the same problem -- profiting off of owning something fundamentally scarce that you did not produce, i.e. rent-seeking. When the taxes are proportional to the most productive use of the land you own it is less profitable or sustainable to manipulate the housing market.

The strictest Georgist philosophy would hold if you happened to homestead in the heart of Manhattan your family will eventually have to choose between paying the price for holding that piece of land hostage from the rest of society or letting someone else make use of it.

In practice, places like Denmark and Estonia make exemptions for owner-occupied dwellings.

... and pricing out existing residents in low density housing by taxing them to oblivion.

I never understood this argument. People are not priced out of their homes. Their homes are rising in prices so they actually have assets to match the price increase. Yes they might not be able to afford the tax, but they have a million dollar asset that they could use. The whole point of the tax is to disencent a single person living in a huge house all by themselves.

The argument is that you shouldn't be forcing people out of their homes. The reason you don't get the argument is that you view people's property as something you should optimize for others, while the people making the argument are believers in strong property rights, especially that they want to be left alone without oppressive government actions. The other half of the argument is that your terms are vague. Not every million dollar house is huge. It could be used to price people out of normal SFH just because the land is zoned in a way that allows higher density housing.

You're literally proposing a scheme that views removing people from their homes as beneficial. Your values don't match with others. That's the disconnect.

And by the way, that increase in value over the years is because other people want to live in that area. Perhaps we should disincentivize that instead of punishing the people who made it a nice area to live in.

This would only work if the assessed value was the actual price i.e. if the agency making the assessment had been bound to buy the property at the price it has assessed. Of course, if such an obligation existed, the land would not have high value in the first place.

Only residents who own tons of land they aren't doing anything productive with.

The whole argument is how to make housing more affordable to live in. Your argument is ... pay more for land tax to avoid speculation however if you live somewhere in order to pay for it you need to consistently be more productive than the speculators (who would just charge the land tax to the renters anyways). Which doesn't solve the problem in any way shape or form.

It does because taxes don't disappear. Say we tax land at 4% and the value of all the land in the US is 100k per person. That means the average person pays an extra 4k and each person receives a $4,000 check. If you own an average amount of land you aren't any worse off.

But what is considered average can change. This is especially true since the land value is not uniform like your hypothetical example. Any system like this can be manipulated for one group to use against a minority group.

That might be how it starts, but history shows rates balloon over time. We already have senior being kicked out because of property tax. Your definition of "tons" of land is vague and may be used against people who have moderate amounts of land (.5-1ac).

At the levels where an LVT is effectively coercive, it’s functionally indistinguishable from rent paid to the government for land you don’t actually own.

I expect most citizens would recognize this and any effective LVT would be politically DOA.

The fact that property taxes exist at all, combined with the fact that failure to pay property taxes means the government takes "your" land means you are in fact renting the land from the government. The size of these taxes is irrelevant.

I invite you to make that sale to the American voter.

My point is that Americans who own one or more plots of land definitely do NOT believe they are renting that land from the government. Ownership is, of course, a degree of control and everything is a matter of degree. Meaningful LVT would be a qualitative change in a home- or farm- or business-owner’s degree of control over what they heretofore considered their property, and they’d recognize that.

To be clear, my position is that property taxes should not exist at all. An LVT would be doubling down on an already immoral tax. Whether it's pennies or 50% of the land's value, that still makes it the King's land, which I find abhorrent.

> At the levels where an LVT is effectively coercive, it’s functionally indistinguishable from rent paid to the government for land you don’t actually own.

I don't see how this follows. Would you mind explaining?

I mean property tax is already rent.

Property tax is rent like a condo fee is rent: It at least approximates a (progressively, in most tax schemes) assessed user fee for community services. The size of the fee is proportional to services rendered.

The LVT as envisioned by its advocates isn’t like that. It’s a fee—largely determined by market forces—to continue to occupy and make use of “your” land. If the government can insist you pay some market-set cost to remain on a plot of land, you don’t own it in the way we classically think about land title ownership. You’re not the market participant, the government is.

Land value tax means you don’t pay any extra tax for developing your property, but you do pay extra tax if the neighborhoods get more expensive. Ergo, incentive for investment and disincentive for speculation.

Suppose you do a “buy and hold” strategy on a neighborhood that is gentrifying. The increased taxes you pay each your will eat into your profits. If you sell, the buyer will have have to pay those taxes too, so the value will be lower.

A very high real estate tax with huge discounts for a single primary homestead makes investment less profitable.

That won't fix the current problem. That would only potentially prevent it from reoccurring to the current levels. Landlords pass tax onto renters. Renters may seek to buy a home, but if supply is locked up by landlords, they may just be stuck.

That's just a less efficient, and less accurate land tax.