Great article. The real gem here is the 6% tax on assessed land values, and how that's both larger than my current city's budget and demonstrably not high enough to totally destroy the land values like LVT haters say will happen.
My city's budget (total spending, not revenue) comes out to 5.4% of assessed land values, and that's with the standard US undervaluing of land. Increasing our budget to 6% LVT would add $200 million to the city coffers, and fixing our assessments to stop undervaluing land would likely require lowering the LVT rate to avoid large tax hikes!
Another data point, because a user on Reddit brought up the current real estate bubble:
My city's property tax, sales tax, and revenue from the state and federal government currently total 2.2% LVT. If the Great Depression happens again, and land values drop 67%, that LVT levy needs to jump to 6.7%, which is just a bit higher than Qingdao and less than the average annual land value increase from The Rate of Return on Everything.
awesome. i'd only ever read that sun yat sen learned of land reform through his western education. this adds a lot to the story. how did you learn of this? i've never heard of qingdao talked about in contemporary land reformer inner circles?
Some LVT friends mentioned it a few weeks ago, which was the first I'd heard of it! I think it's one of those things that "everybody knows" and therefore doesn't think to bring it up, and so everybody doesn't actually know the thing that "everybody knows."
Great Article. Thank you for writing it. I'm sure it was a lot of research.
When I first got interested in Land value taxation, I realized that people thought the rental value of land was an annualization of the selling value. They didn't realize that it was that plus the amount of rent that was already being paid or collected, and would continued to be paid to government. They didn't know (I still don't) how much of the price that is paid for land is based on the present income, and how much is based on expectations of higher future incomes.
Great article. The real gem here is the 6% tax on assessed land values, and how that's both larger than my current city's budget and demonstrably not high enough to totally destroy the land values like LVT haters say will happen.
My city's budget (total spending, not revenue) comes out to 5.4% of assessed land values, and that's with the standard US undervaluing of land. Increasing our budget to 6% LVT would add $200 million to the city coffers, and fixing our assessments to stop undervaluing land would likely require lowering the LVT rate to avoid large tax hikes!
Another data point, because a user on Reddit brought up the current real estate bubble:
My city's property tax, sales tax, and revenue from the state and federal government currently total 2.2% LVT. If the Great Depression happens again, and land values drop 67%, that LVT levy needs to jump to 6.7%, which is just a bit higher than Qingdao and less than the average annual land value increase from The Rate of Return on Everything.
So yeah, pretty sure the Single Taxers are right.
Enjoyed the article. And I intend to enjoy a Tsngtao or two in your honour.
awesome. i'd only ever read that sun yat sen learned of land reform through his western education. this adds a lot to the story. how did you learn of this? i've never heard of qingdao talked about in contemporary land reformer inner circles?
Some LVT friends mentioned it a few weeks ago, which was the first I'd heard of it! I think it's one of those things that "everybody knows" and therefore doesn't think to bring it up, and so everybody doesn't actually know the thing that "everybody knows."
Great Article. Thank you for writing it. I'm sure it was a lot of research.
When I first got interested in Land value taxation, I realized that people thought the rental value of land was an annualization of the selling value. They didn't realize that it was that plus the amount of rent that was already being paid or collected, and would continued to be paid to government. They didn't know (I still don't) how much of the price that is paid for land is based on the present income, and how much is based on expectations of higher future incomes.
Is this bit a typo or translation error?
“First class land was compulsory taken for 37.50 Mexican dollars per mu (75 Mark)”
Best I can tell, a mu is a traditional measure of land area in China, and the (75 Mark) is the local price conversion for Mexican dollars.
As for the grammar, it seems the referenced article was written originally in Chinese and translated to English later by one of the authors.
Very interesting article! Thank you for sharing this information.