Consumption tax screws the working and middle classes the absolute most because they consume the most as a % of their income.
There's a reason it was pushed mostly by billionaires.
LVT is the most egalitarian tax. It's completely unavoidable for land owners, renters pay nothing at all, it skews highest on the biggest landowers and it doesnt disincentivize productive investment or productive work.
> Consumption tax screws the working and middle classes the absolute most because they consume the most as a % of their income.
This is the rich corporation PR that I'm talking about.
So here's Richie Rich not spending most of his income, but also not selling any shares unless he wants to buy something. In fact, he doesn't sell shares even then, because instead he borrows money to buy things, so there are never any capital gains. Without a consumption tax he pays no tax at all.
But you're saying we need this tax, whose practical effect is to tax middle class people on the inflationary component of asset price increases, because they spend more of their income. Instead you want to tax middle class people on their income. But then what benefit do they receive by using an income tax which immediately taxes all of their income?
LVT ignores that there are other resources that may be hoarded. In particular, companies can hire all the employees with the skills necessary to build a competitor and have them do busy work to avoid having to innovate or compete on the merits of their products.
This is essentially the same thing as buying up land and leaving it fallow, but with human resources instead of land. In some ways this is worse, as society has already invested in training those workers.
Employees are not a finite resource. Pay enough to hire half of the chartered accountants and that will drive the creation of more. Demand follows supply.
Land is finite. Buy half of all the land and that won't exactly drive the creation of more land will it? It'll just drive up the price of existing land.
This is in a nutshell why some things in America are dirt cheap (e.g. electronics, clothes) while houses keep getting more and more absurdly priced.
> It's completely unavoidable for land owners, renters pay nothing at all,
In this world, renters pay all of the expenses incurred by land owners via a payment we call "rent".
Note that LVT discourages diverse development. You see an empty piece of land that should be filled with condos. I see an open space that lets me see something other than condos.
In this world renters already pay a 100% land value tax. Levy a land value tax on landlords and renters will neither pay more nor less. It's already baked into market rent.
There is law, economic or otherwise that a business has to make a profit. With an LVT you cant profit from land speculation only providing a good, well maintained property which uses space efficiently.
LVT does not discourage diverse development. It only discourages land hoarding and inefficient use of land (e.g. San Francisco's one family homes).
There's a reason it was pushed mostly by billionaires.
LVT is the most egalitarian tax. It's completely unavoidable for land owners, renters pay nothing at all, it skews highest on the biggest landowers and it doesnt disincentivize productive investment or productive work.