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All your knickers are taxed by us!

But, if you think about it, that is true of all commodities. They are all composed of essentially indestructible base materials, which are always scarce to a degree and which would cause inherent problems if they all wound up being owned by a small group of people in the future. There is nothing particularly special about land, other than the fact that it is one of the easiest commodities to “harvest” in terms of labour input and that laying claim to it is inherently visible.

If you are against private ownership of land, you are against private ownership of all commodities.

- Jaded Voluntarist, Samizdata commenting on a post about Land Value Tax.

I agree with JV but would go further. It appears to me the basic argument for LVT is to kind of force people to be “productive” with their assets. It seems it takes almost a moral view on this. I don’t know in what sense JV meant “commodity” but I see no reason, if you accept the LVT logic, not to extend this argument to all property from a heap of coal (a commodity in the technical sense) to things that aren’t commodities but just “stuff people own”.

Let’s say you own a helicopter. Why not, by the LVT logic, should you not pay Air-transport Value Tax on the chopper because you might decide to use it to run an air-taxi business? Well, why not? Those hundred acres you own might similarly be used to raise crops, build houses or whatever in exactly the same way.

So, you don’t have a hundred acres or a whirly-bird but I bet you have a computer? So why not Website Development Tax on the basis of owning a computer?

To take it to a sort of reductio ad absurdam in terms of possessions – what of underwear? You might have those frillies and posing pouches for purely personal reasons but that doesn’t mean they can’t potentially be used to pursue a career as an “exotic dancer” (or similar) any less than the hundred acres of land be used to enter into organic market-gardening? So why not just tax them the same way?

My point here is that if the mere ownership of land can can be taxed on the basis of it’s perceived economic potential then so can everything else. The LVT principle means an undermining of the entire principle of private property whether the mightiest of estates or the skimpiest of g-strings.

PS. And before anyone starts… I appreciate foxy underwear doesn’t last as long as land but in much the same way your underwear drawer’s contents need maintaining with a continual influx of expenditure so does property if you want to maintain the value of either.

31 Comments

  1. Julie near Chicago says:

    Oh, the LVT is just as dippy as the LTV. (Also the STP–not the oil additive–but we won’t go there tonight, I haven’t the strength. :( )

    People say the total amount of land on the planet is fixed, which sounds plausible. So naturally, every bit of dirt should be made the most of, so holding land and not “using” it–in the way, naturally, that I personally find is most beneficial– is really stealing from others. Stealing utility. Stealing wealth. If you are allowed to hold your land, especially if you’re not going to use it, then it’s certainly fair and proper to expect you to contribute something of value to, um, Society, to make up for it. No?

    OTOH, Man is always stirring things up, so now there are those airports the Japanese saw fit to fit into Osaka Bay (although I thought I heard Kansai is sinking), and then there are the formerly-nonexistent Palm Islands of Dubai, and who knows what else. Oh yeah, Oak Street Beach in Chicago and like that. So maybe the idea isn’t so plausible after all.

    But although the above is true enough, the real problem, as usual, is people. Really, Nick, your point is spot on. No matter what you do with whatever it is you have that’s not attached to you by the OEM–and sometimes, even if it is–some guy will have some better use for it.

  2. Troy says:

    I think the only real difference between land and other commodities is that it’s the one thing of value that you can’t move to a different domicile (except by war, I guess). I suppose that’s why, from the point of view of collectibility, it’s appealing to both revenue authorities and people whose pet economic theories cannot survive the reality of capital flight.

    Speaking of helicopters I think Italy at one point had a value tax on aircraft. Result – not many aircraft registered there!

  3. john malpas says:

    And there is a righteous and pressing need to tax things? Everything ?

  4. Julie near Chicago says:

    Absolutely, john. Everything in this wonderful will be free, you know. Therefore, first, you’ll have ALL of your money left over, so you can easily afford to give it all to the Government that makes this all this largesse free. Second, since everything is free, there’s no natural incentive for anybody to work. But the Government does need its taxes, you see, so that you can get all this free stuff, so that you can pay taxes on it. Therefore you have to work, so as to get paid, so that you’ll be able to pay the taxes, so that you’ll be able to get all your stuff free. What could be simpler? Or more righteous? :)

  5. Paul Marks says:

    How high would this “land value tax” be?

    And would it really be in place of all other taxes? Or ON TOP OF THEM?

    As for the moral point.

    Why should not the owner of land leave it as natural reserve if they wish to do so?

    Why should everywhere be turned into a housing estate – even AGAINST the wishes of the owner?

    After all selling for houses (“growing concrete”) is more profitable than, for example, farming for food.

    As for the counter argument “farmers are subsidized” then – abolish the subsidies (as they have in New Zealand) – two wrongs do not make a right, the wrong of farm subsidies do not justify the wrong of LTV.

  6. Paul Marks says:

    By the way – good post Nick.

  7. Lynne says:

    This is what happens when the head of the local parochial council seizes the initiative to personally investigate the contents of knicker drawers. I’m not at all certain that a view to taxation was the instigation though…

  8. NickM says:

    Paul,
    A few years ago my Dad was in a pub in Northumberland and overheard a couple of farmers. One said, “Mate, the only thing I’m planting this year are houses…”.

    A shame in a way. Things are bent out of all shape if very fertile land (and the Tyne valley is that) is better for dormitory towns than rearing cattle or planting crops. There is something sick about this and you are right about the NZ example. Subsidies don’t help – they are methadone for a heroin addict at best. I once temoed for the Rural Payments Agency. That was an eye-opener I can tell you.

    So what is land worth? Who knows? To take a perverse example for the government “virgin” land is in a sense more “valuable” than built-upon land if you want to build an HS2. or some other farce. Interstitial spaces can be valuable in that sense. I mention HS2 here because it will involve knocking down a large chunk of Camden for example. The essential issue here is “valuable to who?” and also nixxing large chunks of the Cotswolds. Which is more valuable? Depends. Depends upon the individual. That’s the whole point of private property. Somethings I own are of no value to anyone else. Or at least are of supremely more value to me than anyone else. For example if at the end of a holiday someone steals my camera then in a very real sense the few quid SD card in it with my piccies is worth vastly more to me than the grand’s worth of camera, lenses etc that enclosed it.

    I guess since I am a warden of a big garden and stuff I appreciate more the specifics of ownership and the relativity of value. Essentially what I’m saying is there would be Hell on if, for example a bypass was built here and the gubbermunt said we’ll give you an equal or better Quaker Meeting House after we’ve demolished this one. People get attached to specific things and it is part of what makes us human.

    To take another reductio ad absurdam (an extremely old and powerful tool in mathematics) would you accept a wife or husband of “equal or greater value”?

  9. NickM says:

    Lynne,
    He looks so “Yewtree”. My wife has had underwear stolen from the line. Mainly bras. Now what is a bra worth? Well, as the Worshipful Mayor discovered about two years but seriously… It is a violation – a sort of second-order groping and also if it is part of a matching set that is no longer matching then the realistic cost of replacement is to have to replace the knickers as well. Which would not be the case if it were a “stand-alone” bra. This people don’t understand. What is 20 litres of diesel worth? Nowt if you need twenty litres of fuel and have a petrol car. What is a free ticket to Hong Kong worth if you want to go to Miami?

    Philip K Dick went loopy but his early shorts are brilliant. The best I’ve read is his short “Paycheck” which brilliantly sums-up that value is dependent upon need. But it flows throughout literature from Richard III wishing that “Bosworth Horse Rental” existed to Jerome K Jerome where one of the three men in a boat “Would give Worlds” for some mustard. Note here that J, the narrator, points out that the same personage (probs Harris) once opined he’d give worlds for a bottle of beer whilst trekking in the Alps and then complained bitterly about being charged 6d for a bottle of Bass.

    Value is fluid and the only sensible way to figure it is circumstantial an individual.

    What value to you, for example, is an all-inclusive Hajj-trip? What value to a pious Muslim?

    We all collect things. We all have interests and they are all different. We all value things differently. Some like stamps, some fine wines, some photographic kit, some C19th French furniture, some would think that mere firewood. The market (by which I mean eBay) smoothes this so the guy with a Louis the XVIII dresser he can’t stand can flog it to someone who would really, really like it. That is why the market represents the individual because the money the guy with the dresser obtains can be spent on… Well, whatever… rare jazz records, fishing tackle, a trip to Las Vegas, a new set of golf clubs, a charitable donation… anything. Who are these demi-gods who are whilst omnipresent and omnipotent not omniscient? They think they are, mind. They don’t know my mind, they don’t know yours. More often or not they are charging the Rabbi (and everyone else) for “giving” him the finest pork loin (at top dollar) and then getting petulant when he says he really didn’t want the bloody thing in the first place.

    On a similar score… I live just on the outskirts of Greater Manchester and I like going to London so HS2 ought to be right up my street… Except it would actually take me longer than the current Virgin service because I can get that from Stockport whereas I’d have to trog into Manchester for HS2. And I live “close” to this dread dwimmerlake! I’d rather a grand of my money was spent on anything else or even chucked down a dis-used mine.

    I’d much rather it wasn’t spent at all.

    But that is just wishful thinking.

  10. Paul Marks says:

    Nick I have been in the Conservative “tribe” all my life – but what Mr O. has done in keeping up (indeed expanding) the housing bubble, disgusts me.

    Sadly the opposition parties are just as much in favour of a “cheap money” policy as Mr O. is.

    It is difficult not to despair.

  11. NickM says:

    Paul,
    It’s happening again… God, I know. I know. Of all the things we need shelter is one so it’s cost going up is a good thing right? No. It. Isn’t.

  12. RAB says:

    Well of course it’s going to be an “On top of” tax rather than “instead of” one. When was the last time a politician removed a tax? They may play with their percentage of the take, just to make the drones think they are doing them a favour, but cancel a tax? Never! Income tax was supposed to be temporary “just till we’ve beaten Boney lads, then back to normal.. honest!” Yeah right.

    My current position is this…

    I bought this house in 1979, for cash, so no mortgage. It is now “Valued” at 20 times what I paid for it (Yeah I know… should have bought two, right?). I bought it because I liked it and it’s a great neighbourhood to live in. Loads of shops restaurants etc etc a walk away. But over the years I have spent over twice what I paid for this place in making sure it didn’t fall down, and decorating it. Did the Council give me anything towards that? No. In fact the Council penalises me for my good taste in putting my house in the highest band of Council Tax.

    Now a Council tax differs from LVT in that it is nominally about you paying the Council for providing “Services” for me. But I don’t use any more council services than anyone in St Pauls or Easton uses, probably far less, so why am I paying twice as much tax as they are?

    Politicians love the idea of LVT, well it’s so easy to collect isn’t it? Unlike income tax or vat, you can’t avoid it. You can’t move your house or land out of their clutches. Whoever is holding the deeds when the tax needs to be paid gets clobbered.

    And just how fair is it? Well it’s not fair at all (as if taxes ever can be). Like I said, I have lived here a long time, my house has risen to 20 times more than I paid for it, but my income certainly hasn’t. Oh I ended up earning considerably more money than I did when I started out in my 20′s, but that’s to be expected isn’t it? Now I am pretty much retired, as is my wife, and the only income we have is from various pensions (the State one has yet to kick in for us, and is derisory anyway) and investments we have made.

    Last week I had a £10,000 bond mature, so I had to find another home for it. I was getting 4.5% on that Bond which isn’t that great, but the best I could find to reinvest that money in now was 2.25% So for a fixed term (2 years) Bond like that I am now earning the princely sum of £225 a year! I might as well keep it under the mattress ar just bloody spend it! Cos it aint gonna keep me in Champers and Caviare with a bit left over for the Ferrarri, is it? I have a shedload of these Bonds, ISA’s and other investments and they are all earning me fuck all. I am already dipping into Capital just to pay ordinary bills. So where do I get the fuckin money from to pay for yet another theft tax, Vince? just because I live in a nice neighbourhood?

  13. NickM says:

    Ah, RAB…
    It don’t exactly work like that. The Rates 2.0 are a very blunt instrument. It’s basically the size of the gaff. I’m band B. I was band B in Levenshulme (which is OK, but… ). So nowt changes. Thing is I live in a two bedroom house (as I always have done – since not being a student or living with my parents etc.). So that seems always to be B. It’s very nice and all two people and a cat need really. I also have a shed but that apparently doesn’t count. Here’s a snorter for you… Actually I’ll email it to you! Somethings are best not open forumed!

  14. Paul L says:

    “It appears to me the basic argument for LVT is to kind of force people to be “productive” with their assets.”

    That’s a bit like saying that the point of TV licencing is to force you to be productive with your TV. It doesn’t really make any sense.

    That said, the piece is an amusingly written exercise in straw man building.

  15. Julie near Chicago says:

    Just for the record, every one of these comments is a treasure and spot on.

    (Well, except the 2-BR house one. I don’t remember whether Timmy is a thief or not, but there was a whole discussion about kleptomaniac kitties back a week or two…our current digs must accommodate three adults and three Owners, a barker and two purrers, and one of the purrers is an avid Collector of Everything, the latest item being a Magic Marker carefully deposited in his water bowl, which he had naturally emptied first. We require several extra rooms in which to store his stash, you see.)

    Nick, “Value is fluid and the only sensible way to figure it is circumstantial [to] an individual.” Very well said! Also, the business of paving over the best (or in our case the second-best) farmland in the country, because of laws (and the corruption they tend to encourage) that favor it, is something that gravely exercises me. So thank you for making that point.

    Great posting, excellent comments. *applause*

  16. NickM says:

    The fundamental quality of the cat is thus.

    Timmy can eat a crane fly and be chomping on it (with the legs hanging out of his mouth) and he’s still cute. Perhaps that ought to be taxed? Fortunately in his middle-age he has given-up on bringing me dead birds. “Oh, Timmy a carked spuggie on my pillow – however did you know?” but now spends his time fighting other cats or (mainly) sleeping seeing as he is a wonderfully dirty fighter (respect!). He’s anti-LVT in principle as such, he just pisses all over such a concept – literally.

    And if it comes to a fight he’s a force. He is usually a cute little thing who will curl up on your lap and purr like a VW but when he’s upset by another cat God help the poor bugger on the end of it. “Castle Laws”? Made by Timmy. I once saw him jump a big ginger tom and hit some back with tactics and aggression Sailor Malan could only have dreamt of.

    I love my cat. A libertarian to the core. As long as he gets his fodder and a play with his toys – that he eviscerates. He knows his territory and defends it.

  17. Paul Marks says:

    Paul L. – it is the Television “license” (tax) that “makes not sense”, and neither does a new land tax.

  18. NickM says:

    Paul L,
    TV is an option. Today I plugged in a little dongle “free” from Sky that gives me OD TV. Now what do I use TV for… Well, mainly for shouting at but sometimes I learn stuff. Mainly from the cooking shows. Now I could go into a wanking frenzy over the Frankie Vaughn or watch whatever. I could also use my HD TV as a computer screen and write brilliant computer programs that could solve World hunger or cure prostate cancer or… Well, whatever. That is my whole point. LVT is a tax on the potential and not the actual so it could mean anything. I could be learning how to make a souffle or playing Angry Birds. Who the Hell are you (or anyone) to appraise me tax-wise on what I do or don’t do with my telly or anything else? I have pencils you know. Are they to be taxed because I could, in principle, sketch stuff that would have Leonardo himself weeping into his paint tray? Why not tax them? Why not tax the fact I can draw but mainly don’t?

  19. Paul L says:

    Very amusing Nick.

  20. RAB says:

    Nah, when you boil it all down LVT is just a tax, no more and no less, just like all the others, except it is easier to collect than most. Whatever excuse is being used (they label taxes differently don’t they), just to make you think that there is a specific reason for them, and that they are being allocated to specific purposes. Nope there isn’t, and they arn’t. I have often chuckled over Value Added Tax, and tried to discern what “Added Value” I have accrued by having the Gubbermunt take 20% of the price I paid for it, be it a pair of shoes or a laptop etc.

    It all goes into one big pot called the Treasury and is then pissed up the wall by our spendthrift friends the Govt. The Road Tax doesn’t get spent on roads now does it? If it did the experience of driving on the M4 might not be akin to roller-skating in a Gravel Pit, would it?

    Hi Paul L. We see you’ve found your way over to the Darkside then? You’ll get much the same arguement here that you’ve already had at Samizdata. But do keep coming, we love a good arguement.

  21. NickM says:

    Paul L,
    In what way do I amuse? And can I take it on the stage?

  22. Paul L says:

    Nick, I suspect tax based humour may be a bit niche, but then it’s probably more accessible than at lot of the stuff at the Edinburgh festival.

    RAB, in my experience, an argument here is generally less likely to result in somebody throwing their toys out of the pram and pulling down the shutters.

  23. NickM says:

    Oh, it’s so niche is it not! So when I buy a grand’s worth of computer parts from Aria Tech in Manchester and then pay an extra 200 hundred quid then that is a fucking hilarity! I larf all the way home. And it isn’t niche. We all pay tax one way or a fucking other.

  24. Paul L says:

    Good stuff Nick. If Peregrine et al at the other place could learn to apply a similar level of humour, they might be able to get through a discussion without throwing a temper tantrum.

  25. Julie near Chicago says:

    Nick, I dearly wish I could meet your Timmy and see him in action. He surely sounds like a wowser, if that’s not too doggish a term. Always good to see a feller who knows his own mind and can back it up with his paws. Probably a fan of Messrs. Marlowe, Spade, and Hammer, although probably lacking the latter’s guilt complex. One hopes so.

    Oddly enough, the only time The Luce ever showed her predatory side (that I know of anyway) was when we were living in Peoria (yes THAT Peoria, “…well, but will it play in Peoria?”). She developed a habit of coming in the back door bearing dead mice, or the remains thereof, and birds. Must have been something in the water.

    Excellent posting and comments to match, whether directly on point or somewhat — tangential. ;)

  26. Paul L says:

    Paul Marks: ‘Paul L. – it is the Television “license” (tax) that “makes not sense”, and neither does a new land tax.’

    From my current perspective, I don’t think introducing a new tax is a good approach either. I’d mostly just like to see income tax, VAT and a swathe of other taxes swept away, forcing government spending to be financed primarily from Council Tax, Business Rates, Fuel Duty and possibly one or two of the “sin taxes”.

  27. Paul Marks says:

    Paul L. – I am glad we agree about the BBC.

    Hopefully we also agree about the pressing need to radically reduce GOVERNMENT SPENDING also.

    Now if you could only do something about that rather scary icon of yours….

  28. Paul L says:

    Paul Marks, I was fairly ambivalent on the BBC until fairly recently; of all the issues surrounding the state, it was so low down the pecking order that I couldn’t really get that bothered about it. However, the extreme pro-intellectual monopoly stance that the corporation has taken in recent times, including trying to add DRM to decoders and the HTML standard, has pushed me to conclude that it is completely unfit to continue existing.

    And what on earth is scary about a giraffe?

  29. Paul L says:

    Incidentally, Paul Marks, I’m glad the we are agreed on the superiority of land/property taxes when compared to income/sales/value-added taxes

  30. Paul Marks says:

    Paul L. – there was no such agreement.

    A giraffe – I never guessed it was a giraffe (my mistake).

    As for the BBC – I would have thought their constant collectivist propaganda (and dragging vast numbers of people into court over the BBC tax) were rather more important than their stance on I.P.

  31. Paul L says:

    No, Paul Marks, to me, the propaganda is almost irrelevant when compared to the organisation’s direct attempts to use the force of the state to infringe people’s liberty and property through the use of collectivist intellectual monopolies.

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