We could achieve the same thing by just jacking up taxes until the land is worth almost nothing (and everyone is essentially just renting land from the government at prices the government sets based on desirability of that area)
All the profit from simply holding land disappears from the market, and all that money instead of going to private pockets now goes to government coffers. The amount would likely be high enough we could get rid of income taxes almost completely (which makes working a more lucrative choice for people)
It’s not politically feasible until home ownership rates drop more significantly though, it would hurt far too many voters right now to pass.
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You don’t tax land based on how much revenue it generates, you tax it based on its value.
Those aren’t even close to similar things, which makes your example completely useless since that’s not how any of this works.
The goal is for the land owner to not make any profit off the land going up in value over time. They can still make money other ways (like running a company)
It’s the appreciation that needs to go away, otherwise all you have is the current pyramid scheme.
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My home generates 0 revenue, and still has tremendous value. Even when it is being used commercially the value of that land varies dramatically based on what type of commercial activity is possible there. Farms and tree harvesting land can be purchased as low as a few thousand dollars an acre.
So no, they aren’t the same thing at all.
If there’s a business that sells hot dogs, and it makes more money off the land appreciation than the selling of the food, then it’s not a hot dog business, it’s a real estate business. If it undercuts it’s competitors simply because it can charge less by outright owning the land it operates on and having paid less for that land because it bought it a while ago, that’s anti-competitive.
Simply put, nobody should be making money on real estate appreciation. If you want to make a profit, make it selling hot dogs. Real estate appreciation adds nothing of value to the economy, preparing and selling hot dogs does.
you tax it based on its value
What mechanism do you propose to determine the value of land? Based on what criteria?
The same criteria we currently use, since we already value land in our property assessments.
Maybe some tweaks here and there to better account for various new factors, but this is a solved problem.
I mean, that is effectively what’s happening to workers now, in a sense - worker wages have stagnated to the point that they are receiving much less of a share of overall profit than they were in the 70s and 80s, while executive compensation has skyrocketed.
The reason executives can’t do what you’re suggesting is because workers are already just scraping by. The wages as they are now are unlivable, if they’re reduced any more, people will walk off in droves. I suspect if by some miracle it passed through both houses and the executive desk without a billionaire yanking it, and land were taxed to hell and back, they’d probably just eat it because it would still be more profitable than letting it sit fallow.
