Comment by JuniperMesos
2 days ago
If you're a professional landowner and investor, and the taxes on one parcel of land in your portfolio went up because someone built Disneyland near it, this is fine. You might want to sell that parcel out of your portfolio now; or you might want to do something like build a hotel on it catering to Disneyland-visitors, which will earn you enough in profits to more than make up for the higher land tax.
If you're an ordinary person who owns the home you live in, and they build Disneyland next to it, most of the ways that the value of the land your home is on increases are useless or actively harmful to you. It's actively bad for you if you have to sell your family home and move somewhere else because you can no longer afford the taxes on it. You're probably not a professional real estate developer who knows how to effectively use the land as an investment, after all, you just wanted to live somewhere stable.
In fact, the increase of value of your land and the consequent tax increase under Georgist land value schemes, would be so bad for you, that you might decide to protestthe construction of that Disneyland to begin with. This is typically called "NIMBYism", and it happens all the time even under current property-tax schemes because the negative externalities of many different types of construction are bad for the quality of life of existing homeowners.
OK great make a homestead exemption. Lots of those already.
You can always make exemptions/reliefs for people whose only property is their one house.
And besides, selling it earns you more money, so you're still not losing out (fair enough that you might not want to move out, but still)
You can defer your property taxes and have them paid out of the proceeds when you sell your home/land.
How is this different from just having higher taxes on capital gains? (Obviously higher capital gains taxes would also impact other assets, but I mean in the context of land. Seems like both result in the same effect if you're able to defer LVT until sale.)
> How is this different from just having higher taxes on capital gains?
The goal of the deferment is to stop a negative outcome (the resident being forced to sell their property because of higher LVT taxes) from occurring until the resident actually wants to do so.
Seems like a huge risk, what if the land then deprecate after appreciating for a while? You'd owe a lot of money from the appreciation years, but the sale of the house doesn't cover it because it's now depreciated
> It's actively bad for you if you have to sell your family home and move somewhere else because you can no longer afford the taxes on it.
But it's no problem of course that several generations of people currently can never afford to own a home of their own even though they contribute enormously to the economy and to society through their highly productive labour?
Ten times more people have already been forced to move away from where they grew up because of real estate prices than would ever have to be forced to move away because of land value taxes.
A hundred times more people can never afford a home because of real estate prices than would ever have to be forced to sell their homes because of land value taxes.
Or you can.. you know, sell the now expensive property, buy one cheaper which doesn't have such appreciation, and enjoy those sweet money gained by doing nothing (well almost). If you invested in stock and gained significantly, you should also not be taxed more on those gains (and even more in tax progressive regimes in most jurisdictions)? Wealth is wealth at the end, you gain more, you pay taxes.
I get it, people are inherently selfish, most don't want to give back to society more than absolutely minimum to keep them from prison, and this mentality is way more common in US or most of 3rd world than say Europe. But then don't complain when state institutions like public schools and healthcare are utter crap, something about cake and stuff.