You bump into the strangest people in the strangest places....
MoooOOOoooo @ Lev
![Wink ;) ;)](data:image/gif;base64,R0lGODlhAQABAIAAAAAAAP///yH5BAEAAAAALAAAAAABAAEAAAIBRAA7)
(private Joke)
Anyway
4. Relative scarcity is simply a fact in all goods and services. Relative scarcity of an item in fixed supply (you cannot simply "make more land") is a problem.
Unfortnately Relative scarcity of land is not going to be changed by any taxation policy, except perhaps to tax children.
Land is a fixed asset. The population is growing. The acreage per person is getting smaller, hence land is becoming more scarce, and hence more valuable.
To reduce the value of land, we as a population of the planet, need to stop multiplying!
5. The increase in value is due to the appreciation of other people's work around you and the provision of public infrastructure.
No, actually, in many cases, the increase in the value of real estate is due to the work of the owner. There is a "growth" factor slightly above the inflation rate, which probably reflects the growing scarcity of land by population increases, but the big money in real estate is to take a empty block of land, and to put something on it.
This is why developers, develop land, and put in infrastructure like roads, power, plumbing. In most cases it is the developer that invests in the infrastructure of a sub-division, not the government. The government often puts in the requirement to provide the infrastructure and makes the rules about how the sub-division will be developed, but it is private capital that does this.
Does the developer make money off this development - yes, and so they should. They took on the risk, so they should get the reward.
Does the community benefit - usually, if the development is done right, because there is new infrastructure and general growth.
Does the government benefit - yes, because there are now more houses to put people into, that the government doesn't need to provide, the value of the land has increased and it can gather more taxes, and an unproductive piece of land is now productive.
The government has had a go at doing this on our behalf in the past, and it has failed miserably in many instances creating areas little better than slums. Examples are area's such as Koongamia and parts of Middle Swan, in Western Australia, which were so called "Homeswest" suburbs.
These areas, even now, decades on, are living with the legacy of such plans, and I know from experience that it is working class families that are improving individual lots, not the government.
Government provided infrastructure can certainly increase the value of land, but often it is provided in response to changing population dynamics or to open up new areas of land.
Increasing Land Tax will simply make it less attractive for landlords to hold property (particularly with the current system of taxing developed land as well as vacant land), decrease the attractiveness of land as an investment, and hence reduce the desirability of private enterprise to improve land.
This wouldn't be a problem if governments do the same job with the same efficiency's as private enterprise, but the fact is that currently they stuggle. Heck, they can't even build a railway to Mandurah without engaging private company's, and even then efficiency is decimated by political agendas.