The main Georgist policy proposal is the imposition of a full land value tax. Generally, taxes should be simple and free from exemptions, because tax exemptions incentivise people to divert resources into places that don’t pay tax. They mean more fees for lawyers and accountants, and less for productive activity. Sometimes they can lead to truly absurd litigation, like the
I am definitely skeptical of arguments that universities intrinsically serve the public good in such a way that they require massive subsidies. In fact, I think it's very likely that universities- and the entire employment and education ecosystem- would be far better off if they didn't have functionally infinite subsidies to blow on endless bureaucratic expansion and shiny new buildings and amenities.
When the government occupies land in SF or DC, productively or not, there is clearly an economic cost to the country because that land is denied to other productive uses. While it doesn't make much sense to collect an LVT since the funds would just be used to pay the LVT, it is still valuable to assess the land rent (what the LVT would be) and account that as an economic cost of our government's land use. This would give us insight into how we can achieve our governance objectives while balancing the land use costs.
The statement "Universities are clearly working for the public interest" is politically controversial. The counter-claim is that they are dedicated to maintaining an elite class, and when you look at who goes to university it's certainly not evenly distributed across the income quartiles or any reasonable notion of "class". For British universities, though perhaps slightly less for Cambridge than say York, there's also the problem that they rely on income from overseas student fees (mostly Chinese) as the government has already cut their funding when the UK moved to a fee system. There are arguments to be had whether this is equitable, or even efficient.
To the extent that governments pay for education anyway, the only point of charging LVT to schools is just to measure the cost. I think Universities should operate under the same rules, pay the government the money and then get it back. We should at least know how much it costs so we can make the decision about whether to modify or abolish the exemption.
" Universities (especially ancient ones) are institutions that should not be downsized, merged, or abolished." Is that attitude common in the UK? I can't imagine even the most committed liberal saying that here in the US.
If a charitable organization rents commercial office space, it will indirectly pay LVT as part of the location value component of its "rent".
But if they own their own building (and land!), should they still pay LVT?
As a libertarian, I think that even a charity needs to be held accountable by the market - that is, it needs to do a good enough job (at doing "good") to attract enough donations to cover its operating expenses. Those expenses should rightly include paying for the burden its facilities impose on government - police and fire protection, roads, etc. Therefore, the organization should pay the same LVT as any non-charitable organization in that location.
A simpler criterion is that LVT should apply to land that is alienable, can be sold. Here in Aotearoa/NZ there is a class of Māori land that is held in common for the descendants of particular tribes and clans (to use British terms) and administered through the Māori Land Court. This land cannot be sold, and it seems to me that it would therefore be inappropriate to tax it. It's maybe 0.1% of the total.
Land that CAN be sold should be taxed to ensure efficient and equitable use. The risk of losing the land is an incentive to make it productive, the very incentive that HG wanted to promote. Value judgements about purposes (such as the National Trust's) are inappropriate in a broad policy such as this. If the National Trust's values are shared sufficiently widely, it will have the funds it needs to pay the tax. Universities are in the business of increasing the stock of knowledge, not land ownership.
I think your point about how privately-owned and operated institution can work for the public good and thus need to be exempt. Non-profits and for-benefit institutions (such as churches, private charities, etc) would be absolutely crushed if they were forced to be profitable in the same way that a business is. Any Georgist policies will need to take this into account if they are going to be successful.
There's another type of land that should be exempt from taxation. Land that has an improvements on it that are so valuable that it is responsible for the large enough portion of the surrounding parcels as to equal or exceed its own LVT liability. Personally, I call it the Disneyland exception. Disneyland itself is responsible for a large portion of the land value in Anaheim, California (and probably an area considerably larger than that) to a large enough degree to completely eliminate what its own LVT liability would be. If anything, arguably the people of Anaheim (and especially the hotel owners), ought to be paying Mickey Mouse for his contribution to the wealth of their community.
For most improvements, this doesn't happen, the contribution of a single house to an average suburban neighborhood is so miniscule as to not be worth the cost of measuring. Even one full-blown skyscraper in the midst of a major city that has many of them doesn't really rate mentioning. However, there are exceptions that should be taken into account.
Walt Disney himself, when he built Disneyland in 1955, didn't have the money to buy up the surrounding land in Anaheim. Once it got going, he was so livid at watching hotels and side attractions spring up near it as he thought they were profiting from his vision. (He also had a lot to say about how shoddy and tacky he thought these places were).
He learned his lesson though. When he built Disney World in Florida (opening in 1971), he first, under anonymous corporate names, bought up huge swathes of Florida swampland, much more than he needed for the size of the original park. He sold some of the land when it appreciated and used some of it to build hotels and other attractions himself.
Interesting. Y'all must have a secret ingredient to public-private partnerships which us Americans don't. Ours always ends up benefitting the private side much more than the public side over time.
I am definitely skeptical of arguments that universities intrinsically serve the public good in such a way that they require massive subsidies. In fact, I think it's very likely that universities- and the entire employment and education ecosystem- would be far better off if they didn't have functionally infinite subsidies to blow on endless bureaucratic expansion and shiny new buildings and amenities.
When the government occupies land in SF or DC, productively or not, there is clearly an economic cost to the country because that land is denied to other productive uses. While it doesn't make much sense to collect an LVT since the funds would just be used to pay the LVT, it is still valuable to assess the land rent (what the LVT would be) and account that as an economic cost of our government's land use. This would give us insight into how we can achieve our governance objectives while balancing the land use costs.
The statement "Universities are clearly working for the public interest" is politically controversial. The counter-claim is that they are dedicated to maintaining an elite class, and when you look at who goes to university it's certainly not evenly distributed across the income quartiles or any reasonable notion of "class". For British universities, though perhaps slightly less for Cambridge than say York, there's also the problem that they rely on income from overseas student fees (mostly Chinese) as the government has already cut their funding when the UK moved to a fee system. There are arguments to be had whether this is equitable, or even efficient.
Ouf... tying land value tax to strong views around taxation of nonprofits, and particularly university endowments, seems constraining.
To the extent that governments pay for education anyway, the only point of charging LVT to schools is just to measure the cost. I think Universities should operate under the same rules, pay the government the money and then get it back. We should at least know how much it costs so we can make the decision about whether to modify or abolish the exemption.
" Universities (especially ancient ones) are institutions that should not be downsized, merged, or abolished." Is that attitude common in the UK? I can't imagine even the most committed liberal saying that here in the US.
If a charitable organization rents commercial office space, it will indirectly pay LVT as part of the location value component of its "rent".
But if they own their own building (and land!), should they still pay LVT?
As a libertarian, I think that even a charity needs to be held accountable by the market - that is, it needs to do a good enough job (at doing "good") to attract enough donations to cover its operating expenses. Those expenses should rightly include paying for the burden its facilities impose on government - police and fire protection, roads, etc. Therefore, the organization should pay the same LVT as any non-charitable organization in that location.
A simpler criterion is that LVT should apply to land that is alienable, can be sold. Here in Aotearoa/NZ there is a class of Māori land that is held in common for the descendants of particular tribes and clans (to use British terms) and administered through the Māori Land Court. This land cannot be sold, and it seems to me that it would therefore be inappropriate to tax it. It's maybe 0.1% of the total.
Land that CAN be sold should be taxed to ensure efficient and equitable use. The risk of losing the land is an incentive to make it productive, the very incentive that HG wanted to promote. Value judgements about purposes (such as the National Trust's) are inappropriate in a broad policy such as this. If the National Trust's values are shared sufficiently widely, it will have the funds it needs to pay the tax. Universities are in the business of increasing the stock of knowledge, not land ownership.
I think your point about how privately-owned and operated institution can work for the public good and thus need to be exempt. Non-profits and for-benefit institutions (such as churches, private charities, etc) would be absolutely crushed if they were forced to be profitable in the same way that a business is. Any Georgist policies will need to take this into account if they are going to be successful.
There's another type of land that should be exempt from taxation. Land that has an improvements on it that are so valuable that it is responsible for the large enough portion of the surrounding parcels as to equal or exceed its own LVT liability. Personally, I call it the Disneyland exception. Disneyland itself is responsible for a large portion of the land value in Anaheim, California (and probably an area considerably larger than that) to a large enough degree to completely eliminate what its own LVT liability would be. If anything, arguably the people of Anaheim (and especially the hotel owners), ought to be paying Mickey Mouse for his contribution to the wealth of their community.
For most improvements, this doesn't happen, the contribution of a single house to an average suburban neighborhood is so miniscule as to not be worth the cost of measuring. Even one full-blown skyscraper in the midst of a major city that has many of them doesn't really rate mentioning. However, there are exceptions that should be taken into account.
Walt Disney himself, when he built Disneyland in 1955, didn't have the money to buy up the surrounding land in Anaheim. Once it got going, he was so livid at watching hotels and side attractions spring up near it as he thought they were profiting from his vision. (He also had a lot to say about how shoddy and tacky he thought these places were).
He learned his lesson though. When he built Disney World in Florida (opening in 1971), he first, under anonymous corporate names, bought up huge swathes of Florida swampland, much more than he needed for the size of the original park. He sold some of the land when it appreciated and used some of it to build hotels and other attractions himself.
Interesting. Y'all must have a secret ingredient to public-private partnerships which us Americans don't. Ours always ends up benefitting the private side much more than the public side over time.