Well, they use this program to cut property taxes in many towns here in Pennsylvania. By not taxing what people produce, invest in and save for (capital and labor), revenue flows for the essential functions of government can be maintained without distorting the economy. Economists from Milton Friedman to William Vickrey have agreed that a tax on land values in the lest harmful tax. William Buckley was a supporter. The idea has been espoused not only by Henry George, but Thomas Paine, Adam Smith, John Locke and Albert J. Nock amongst others.
Karl Marx referred to George's land tax as "capitalism's last ditch."
Example:
In the strict public policy application, Land Value Taxation (also known as split-rate real property taxation, and two-tiered real property taxation) is a type of real property taxation. Whereas the typical real property tax taxes both land and the improvements on the land at the same rate, land value taxation taxes land at a higher rate while simultaneously reducing, or even eliminating, the tax on improvements.
For example, Clairton in Allegheny County, Pennsylvania has a tax rate of 103 mills on land and 4.32 mills on buildings rather than 29.5 mills on both (City and School District combined). That means instead of the standard property tax, where about 75% of tax dollars come from buildings, about 90% comes from land values. Clairton is poor city; which used to be a steel town.
Towns as small as Steelton (pop.2,500) to as large as Allentown (pop. 105,000) have used LVT successfully in Pennsylvania.
Joshua Vincent
www.urbantools.org
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