Comments by "John Burns" (@johnburns4017) on "Richard J Murphy"
channel.
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@lincolnpork9357
Firstly, economic rent is when there is:
a) no costs of production;
b) no enterprise;
♦ Land Value Tax does not socially/community exclude anyone. It reclaims commonly created wealth to use for common services. What we create we use to pay for our services. Simple. While leaving private wealth in private pockets. Currently we do the opposite. It is that simple. Land tax is cheap and easy to collect, with huge tax office employing swathes of people, and snoopers. Land, unlike money, cannot be taken offshore. The location of land is known to the inch.
♦ When levied at 100% of land rental value, LVT will eliminate personal income tax and maybe sales taxes.
♦ LVT near eradicates harmful land speculation.
♦ LVT creates a stable economy with speculation near gone.
♦ LVT promotes enterprise, as it makes matters easier for small businesses, as they do not get bogged down in income and sales taxes. In the late 1950s/early 1960s, Denmark found that enterprise was boosted by LVT as investment went into enterprise not locked up in land. The economy grew with zero unemployment.
♦ Of course we charge for use and extraction of what is commonly owned, to reduce, or eliminate income & sales taxes.
♦ Pigovian taxes do not reclaim economic rent, as does LVT, or charge for use or extraction of what is _commonly owned. They are disincentive taxes. They can also penalise polluters, such as fossil fuel taxes. You pollute our environment then you pay.
♦ If people earn money through pure enterprise in an unrigged and unmonoplolised market, let them keep all they earned, as they did good for many along the way. They also took nothing out of society, only putting something in.
♦ Economic parasitical activity has to be eliminated.
♦ Promote productive activities.
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LVT reclaims commonly created wealth to use for common services
The value of land is created by the surrounding community not the landowner. Land on a desert island with one person on it is worth zero. Have many people on the island then land has value.
LVT reclaims this commonly created wealth to use for common services. What wealth we create, we use for us. Ideal! Currently we use privately created wealth to pay for common services using income tax. Currently we penalise the productive, allowing the unproductive, landowners for e.g., to appropriate commonly created wealth.
LVT cannot be passed onto the tenant
Market forces come into play, as happens right now. Landlords try to get as much rent at all times. Raise the rent too high? The tenant moves. Implying they can up the rent without any care implies they are undercharging, which they are not.
LVT must fall on the landowner
The owner should not pay the levy? How odd. Someone else should pay for what someone else owns? Very odd. The landowner owns the land, his responsibility, so he/she should pay.
Land values are easy to assess
Ask an estate agent, they will tell you. In other countries the property tax bill tells you how much you pay for the land and the building. Not difficult.
LVT must tax all land
Taxing all land by it value with a building on it or not, or occupied or not, stops harmful land speculation (2008 crash was down to land speculation). Buy land and keep for years on end, but you pay. Few will keep the land, then sell it to someone who will put the land to good productive use.
LVT will eliminate personal Income Tax
The late Mark Wadsworth did the calculations for the UK.
Those in favour of LVT also want all commonly created resources charged for. Use, or extract, what we all own you pay us.
Taxing land has had great benefits in the world where it is done. It is what they did before Income Tax, a temporary tax for the Napoleonic wars. Landowners, via the House of (Land)Lords, etc, realized they could push the burden of taxation onto the poor, so it was kept.
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1) I take a £30,000 loan for a car over three years.
2) The bank creates the money out of thin air.
3) Money put into my account.
4) Car dealer is paid - he takes his cut and pays the wages of his staff, property taxes, other taxes and car manufacturer. That money is circulated into the economy.
5) The car manufacturer pays his staff, taxes and suppliers. That money is circulated into the economy.
6) I pay back the loan to the bank each month, with interest.
7) The bank pays its staff and taxes with that money. The money circulates into the economy.
8) When I fully repay the £30,000 loan after three years, the bank destroys the money, as they never had the money in the first place as it was created from thin air. If they do not destroy the money, they are printing money for themselves, so it has to be destroyed.
9) So I work and the money (£30,000) which I got up front from a bank goes directly into the economy, doing good. I pay for this money circulating into the economy, over three years.
But what an earner for the banks. They create £30,000 out of thin air, do get to keep the £30,000, then charge interest on £30,000. £30,000 they never had in the first place. Money for nothing.
So, HMG, via banks, creates the money for a loan out of thin air. I pay the loan back, then this money created out of thin air is destroyed. It is only in existence during the loan period. If there is no debt there is little money floating around.
If HMG wants to create money out of thin air, maybe it will be better for society to use it for a Universal Basic Income (UBI). Then maybe fewer loans, with less use of banks.
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