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Why not reduce the overall tax burden instead by reducing the role of government in everyone's lives?
No need for complicated tax schemes at all. Cut government down to a manageable size, install term limits across the board, and institute a reasonable graduated flat tax on whatever form of wealth/production one deems best.
Too easy. But what you will find is that any program that reduces graft and corruption is quickly sidelined. Politicos love complexity because it helps them hide their corruption.
Why not reduce the overall tax burden instead by reducing the role of government in everyone's lives?
No need for complicated tax schemes at all.
Geonomics is primarily one tax, tax on land values - the value is set by the market. No income tax or sales tax, etc. So simple. So effective, So fair. Read my big post again.
Disagreement is not a sign of mis-understanding. You communicated adequately in your initial post, I simply do not agree with you.
Here in the US, property is already taxed, usually at the county level. Depending on where one lives, the property taxes can approach the income tax in order of magnitude. I live where I do in part due to low property taxes.
Good. You are a classical economist. Forget the stock market for now. Capitalism has its merits and Karl Marx emphasised those plus points. It is the abuse of Capitalism that is the problem. In a high tech world full of resources we still have grinding poverty in rich countries. Marx and others saw this and came up with their own solutions. How is the abuse stopped and a "fair" system implemented? This where there is conflict which has also led to massive wars. The privileged will not give up their privileges without a fight. Karl Marx could not see a solution to this abuse and his solution was simple - abolish Capitalism. Others think differently and know how tom incorporate the plus point of Capitalism into a fair system.
Geonomics. Used in Hong Kong, Singapore, Parts of the US, Australia, etc. The core is:
Land Value Tax (LVT) which is essential and prime
An unrigged free-market
Eliminating speculation on land
Eliminating speculation on the earths resources
Reclaiming "economic rent" - use commonly created wealth for common use
The productive keep all their the fruits of their labours
The biggest portion of "economic rent" is found in land values and the easiest to identify.
The key to understanding is understanding where the value in land comes from:
Land values were socially created by the community -NOT the landowner. This community created wealth is reclaimed to pay for community services which benefit us all.
Private wealth is is kept by the individual who created it - no income tax or sales taxes.
Currently we do the reverse, which produces booms & busts, most wealth is in the hands of a few with a grinding sub-poverty level and world-wide crashes every generation or so.
Production harming Income Tax and all other taxes, Sales Taxes, Property Tax, etc can all be eliminated using LVT. Geonomics goes further and takes into account the land resources and charging for use and extraction. Land is: land and all of its resources, the seas and sea beds and the electromagnetic spectrum. In short, charge for all commonwealth of land and resources usage and extraction, inc the electromagnetic spectrum.
We need to be more productive, less 'disincentivized' and less property obsessed. Land taxes would smooth out damaging housing bubbles and encourage more productive investment.
A Land Value tax would help address the inter-generational inequality between property haves and have nots that was massively exacerbated by the long property booms of 1995-2007
A land tax is easy to collect, hard to avoid, and would help fund the large scale infrastruce investment needed.
For an ultra-capitalist, the rapid accumulation of wealth over the last 15 years, which in property terms amounts to about £2.5 trillion, is making us fat and lazy. Only a wealth tax can sort it out. LVT is wealth tax, or more correctly reclaiming commonly created wealth.
The OECD, the rich nation's think tank, has joined the ranks of Land Value Tax supporters.
Land Value Tax is impossible to avoid - land's location is know to its inch. Land cannot be taken off-shore. The Greek govmt loses 15 billion euros each year due to tax evasion. They are NOT a big govt or country. Taxing land values mean the land cannot be moved off-shore and all tax is collected.
LVT can fund all infrastructure - Hong Kong built a new metro using it. Infrastructure is the basis for economic growth creation - look at London's underground. The economic growth created by infrastructure is not being fully cycled back into funding it - it is being slid down a giant sluice called the land market, draining it away into private hands.
Land Value Tax taxes Wealth not Income. Understand that.
Harmful speculation on land drops when LVT is levied - more will be spent on the structure rather than the land.
LVT will do the opposite and accelerate home ownership - 2/3 of the price of the average UK home is the land not the bricks. LVT will do the opposite and accelerate home ownership.
LVT clears up Derelict buildings - Harrisburg in the USA adopted a watered down form of LVT and cleared up all the derelict buildings. You pay full tax on the land irrespective if a building is on it or not. Currently put a hole in the roof and remove the bathroom and you pay no tax whatsoever, and leave a derelict, eyesore building attracting vandals and vermin. In Fred Harrison's 2005 book Boom and Bust, he points out that landowners who aggressively accumulate land for property speculation in prime parts of the country would face a huge LVT bill. Idle land and buildings would be brought into use using LVT. Harmful land speculation is rolled back.
LVT gets rid of stealth taxes - in its ultimate form is known as the SINGLE TAX. Income tax can be abolished, or vastly reduced.
LVT is reclaiming community created wealth to pay for community services - LVT is not a tax, despite tax in its title.
Full Geoism is one tax the SINGLE TAX - this means no speculation on land and the earth's resources, such as copper derivatives, etc. BTW, a few weeks ago water was made a commodity - water derivatives a have emerged. Geoism would forbid this harmful, speculating, nonsense.
LVT shift tax to families from Idle landlords - Over time, the aim of LVT would be to shift the tax burden off hard-working families and on to idle landlords - as in Hong Kong, where revenues from land taxes keep income tax low, there is no sales tax or capital gains tax, and enterprise flourishes. People keep more of the fruits of their labour.
People overall pay less using LVT - Using LVT, in the UK someone earning £40,000 a year would stop paying around £7,000 in income tax, £1,000 to £2,000 in VAT, £1,600 property tax, up to £11,600 at this point, and any of the transaction charges that fill the exchequer's coffers. No more capital gains tax or stamp duty on property sales or the sale of shares. Instead they would pay a fixed annual sum, to be paid monthly, on the value of their land, which could have a wide range, depending on how much the land is worth.
LVT means you can move to an internal tax haven - Move out of town and work locally, and your overall tax bill could be a fraction of its current total. Buy an expensive piece of real estate in the city centre and you would probably pay more. You can move to an internal tax haven, like in rural Wales or Cornwall where the land values are very low and pay little LVT (recall no property tax, sales tax, etc). The local economy would appreciate the spending income of the "exiles".
LVT is a voluntary tax - you can move to a lower land value area and pay less tax.
LVT does not distort business behaviour - All stays the same. In fact as there is no income tax and sales taxes businesses are slicker, cheaper and easier to run. There are no admin costs to collect taxes.
LVT will Promote Higher Quality Homes & the Construction industry - There are many positive points for wealth creation. A worker keeps all his income and there is a 100% gain for every extra hour worked. If you develop your house, it has only a limited effect on the value of the land, giving you every incentive to modernise and improve the house. Under the Property Tax, increases in house values, as opposed to land values, lead to higher taxes, which is a disincentive to carry out improvements in the first place. Currently we curtail the construction and its associated manufacturing industries.
LVT prevents the rich from clawing back all their taxes
Britain's top earners pay on average £1.25 million in taxes in their lifetime. The people who rent their homes are generally in the lowest income bracket. Over their working lives the poor pay over £0.25 million in taxes. The rich on average pay 5 times more in taxes.
That sounds fair. Doesn't it? But wait.....
Income tax is the more you earn, the more you pay. Called Progressive taxes.
Sounds fair as the richer pay more. But!!! Progressive taxes has exactly the
opposite effect.
Every increase in house value for top earners offsets any tax they contribute. During boom times it's possible to claw back a lifetimes taxes in just three years. Meanwhile...the lowest earners and those who pay rent, pay more overall.
Families on the lowest incomes subsidize the lives of the rich. Is that fair?
Despite all these advantages, there are many powerful forces ready to dismiss LVT as fanciful, not least the property-owning classes who have an entrenched view that their house/land price is a just reward for their labour - which it was not. Community activity created the wealth of their land not them, the landowner.
What LVT campaigners have shown is that the average taxpayer will be no worse off, if anything directly far better off, they will simply pay less income tax and a higher wealth tax. They will also have larger and better homes to boot. Then the improved economy all around will make them wealthier again. A wealthy economy rolls back the state and welfare state reducing the pull of the state. Any surplus economic rent reclaimed can be issued amongst the population via a Citizens Dividend or a guaranteed income issued, which will eliminate many welfare payments and their associated departments.
Once a fair system is in place and the harmful hot spots identified and neutralized (speculation on land and its resources and elimination of monopolies) then we have a firm stable non-volatile base to work from.
No, absolutely not!
Using local revenue for public education perpetuates income inequality because kids of poor families who can't afford expensive property or high property taxes end up receiving subpar education, are less likely to get into stable careers, and likely to end up in poverty themselves.
Until this problem is solved, relying on LVT as opposed to state and federal income and sales taxes is a horrible poverty trap and as a result is one of the worst policy proposals I've seen on CD.
Why not reduce the overall tax burden instead by reducing the role of government in everyone's lives?
No need for complicated tax schemes at all. Cut government down to a manageable size, install term limits across the board, and institute a reasonable graduated flat tax on whatever form of wealth/production one deems best.
Too easy. But what you will find is that any program that reduces graft and corruption is quickly sidelined. Politicos love complexity because it helps them hide their corruption.
The government is not unmanageable in size, they just have their priorities in the wrong order, and don't appreciate the importance of science and education.
I"ll tell you what I'll do if you up my land tax. :-p) I'll sell it and tell you to go to hell. The bank really owns it, anyway. The poor are where they are cause they are too dumb to realize what a mistake it is to have kids before you have BIG money. It's one or the other. Get out of poverty or have kids. It's extremely unlikely that you can do both.
Disagreement is not a sign of mis-understanding. You communicated adequately in your initial post, I simply do not agree with you.
Here in the US, property is already taxed, usually at the county level. Depending on where one lives, the property taxes can approach the income tax in order of magnitude. I live where I do in part due to low property taxes.
You still did not get it. You need to understand first before you can disagree. It is reclaiming economic rent. This forms as values in land, not the buildings. It is then a matter of reclaiming the commonly created wealth. Land Value Tax is a misnomer and many want a rewording reflecting what it actually is. LVT is levied annually, and assessed annually, only on the value of the land - not the buildings. The value is set by the free-market not the local authority. Note: land values can go up and down. If a power station is to be built opposite your house and land values drop, then you pay less. If you have worthless land then you pay zero.
Property tax is a tax and on the land and buildings. A tax on LAND and CAPITAL. Having LVT as the prime tax form of revenue eliminates countless other taxes.
You clearly did not understand. Clear your mind of the tax systems we currently have. The poverty trap is because we have a trickle up effect. Commonly created wealth (economic rent) is appropriated by individuals and organizations. Income and Sales tax is stealing from the wealthy producers.
You still did not get it. You need to understand first before you can disagree. It is reclaiming economic rent. This forms as values in land, not the buildings. It is then a matter of reclaiming the commonly created wealth. Land Value Tax is a misnomer and many want a rewording reflecting what it actually is. LVT is levied annually, and assessed annually, only on the value of the land - not the buildings. The value is set by the free-market not the local authority. Note: land values can go up and down. If a power station is to be built opposite your house and land values drop, then you pay less. If you have worthless land then you pay zero.
Property tax is a tax and on the land and buildings. A tax on LAND and CAPITAL. Having LVT as the prime tax form of revenue eliminates countless other taxes.
I do understand, it is not complex. I simply do not agree with you. The distinction you make between land and other property is a false one and silly.
Take this example:
"Note: land values can go up and down. If a power station is to be built opposite your house and land values drop, then you pay less. If you have worthless land then you pay zero."
The same thing happens with housing that is in an undesirable location, or the example you complained about earlier, when a property owner allows a house to fall to ruin in order to reduce the taxes (or perhaps for other purposes). Same thing happens with your car if you do not keep it up.
What is the difference in your example between an ugly power station next door and an ugly run down house on the land itself? Surely an identical bit of land with a pretty little house on it will command more market value. Buildings are expensive to remove, build, or change -- and that is why real properties are valued as a whole.
In the US, our property taxes are levied annually, though many counties allow timed payments to lessen the burden. They are assessed based on the perceived market value of the property as a whole, but they do not set the value of the property, as you appear to think they are - values are set by what people are willing to pay. Perhaps in the UK the local authority does set the value.
I do understand, it is not complex. I simply do not agree with you. The distinction you make between land and other property is a false one and silly.
Take this example:
"Note: land values can go up and down. If a power station is to be built opposite your house and land values drop, then you pay less. If you have worthless land then you pay zero."
The same thing happens with housing that is in an undesirable location, or the example you complained about earlier, when a property owner allows a house to fall to ruin in order to reduce the taxes (or perhaps for other purposes). Same thing happens with your car if you do not keep it up.
What is the difference in your example between an ugly power station next door and an ugly run down house on the land itself? Surely an identical bit of land with a pretty little house on it will command more market value. Buildings are expensive to remove, build, or change -- and that is why real properties are valued as a whole.
In the US, our property taxes are levied annually, though many counties allow timed payments to lessen the burden. They are assessed based on the perceived market value of the property as a whole, but they do not set the value of the property, as you appear to think they are - values are set by what people are willing to pay. Perhaps in the UK the local authority does set the value.
I simply do not agree that you understand, given every point you attempt to make demonstrates that you don't.
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