Why We Can’t Tax Land Values Down to Zero

by Polly Cleveland

Georgists often claim that we can and should tax land values down to zero, or almost zero. However, this claim depends on ignoring how taxes are spent. As Mason Gaffney has shown, All Taxes Come Out of Rent (ATCOR) — including bad taxes like sales taxes. Moreover, all deadweight loss or “Excess Burden Comes Out of Rent” or EBCOR. Less obviously, all subsidies and spillovers from public investments go into rent, call this ASGIR. Let’s take three examples to follow the implications. Continue reading