vanderbeek nevada property tax henry george

Nevada Governor Candidate vs. IRS
income tax kansas louisiana oklahoma pigovian tax crop cess land rent

The Right Way to Eliminate Income Taxes

Could taxation itself be abolished if society used fees to recover socially-generated values? We excerpt three 2013 articles from: (1) D. VanDerBeek, Jan 26, on the IRS; (2) Huffington Post, Jan 25, on state taxes by E. Lehrer; and (3) Tanzania Daily News, Jan 17, on agri-rent by F. Simbeye.

by David Lory VanDerBeek, by Eli Lehrer, and by Finnigan Wa Simbeye

David Lory VanDerBeek is running for governor of Nevada. If elected, he promises to legally protect residents who refuse to pay federal income taxes. Will he be swept in by a landslide? To view more .

JJS: While a showdown between the IRS and a state governor would certainly be worth watching, it probably won’t be coming to a screen near you any time soon. However, some states are looking at ending their own income tax, one way or another.

Many core Republican voters are, paradoxically, dependent on government spending ranging from transfer payments (Social Security) to government jobs (police officers, for example). Thus, eliminating income taxes and making up the difference through spending cuts is often quite politically difficult for Republicans no matter how much they talk about smaller government.

If they can't simply cut spending -- and most states probably couldn't reasonably eliminate every service currently paid for by the income tax -- states should consider "tax swaps." And two types of tax swaps, on land and pollution, deserve particular consideration.

First, states should consider higher taxes on land. As the 19th-century political economist Henry George first observed, land -- unlike everything else -- isn't actually created by any person (although improvements on it are.) Any given piece of land has the same highest and best use if it's value is taxed at 100 percent or nothing at all. The closest thing most localities have to land value taxes are property taxes. States with very high property taxes like New Hampshire and Texas tend to have low overall taxes too.

Second, states should consider raising taxes on bad things like pollution. These taxes, called Pigovian taxes after economist Arthur Pigou, tend to both deliver revenue and reduce a variety of ills. While one type of Pigovian taxes -- in taxes on alcohol and tobacco -- are already high and widely applied, a wider range of Pigovian taxes are well worth considering. While some -- like "fat taxes" seem like consumption taxes by other means, others, like taxes on energy use or carbon pollution -- could make a great deal of sense because they would bring in a fair amount of revenue without most people noticing.

Reducing spending is a good idea. Cutting taxes is also good. And if state politicians want to figure out how to eliminate income taxes, they should work to think about spending cuts and smart, pro-growth tax swaps.

To read more

"Crop cess" (like a tax) and land rent are what the private sector has singled out as stumbling blocks in the agriculture sector. So far sector growth has not surpassed 3.6 per cent.

Last year, land rent was increased by 500 per cent from 200/- per hectare to 1,000/-.

Farmers also pay crop cess of between three and five per cent to district councils.

Agriculture contributes 23.5 per cent to Tanzania's gross domestic product, over 40 per cent of foreign currency earnings and over 90 per cent of the country's food needs, annually.

Government should formalize agriculture land as is the case with conservation land, mining areas, and manufacturing areas so that regular conflicts don't occur between farmers and pastoralists.

To read more

JJS: Not only do states recover some land rent by levying a property tax, some nations recover land rent by simply charging it. Knowing how much to charge is key. Charge too much, and potential users walk away. Charge too little, then speculators jump in and inflate prices. To know just how much to charge, governments could auction off land titles. In many places, government and business are in collusion, so usually the bigger worry is charging too little. But if government used land rents to abolish taxes on labor and capital and to pay citizens a dividend, then a popular movement would back the program. Problems with tax collectors and tax dodgers both would wither away.


Editor Jeffery J. Smith runs the Forum on Geonomics and helped prepare a course for the UN on geonomics. To take the “Land Rights” course, click here .

Also see:

Flint Mayor for the Property Tax Shift

Ever Hear of Bradley Birkenfeld?

Hunger Haunts Many in Africa

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