Land Value Tax- The only justifiable tax

Most tax systems punish the wrong behavior. We tax people for working, for building, for improving their homes, and for running businesses—while leaving unearned wealth largely untouched. Property taxes are a perfect example of this backward logic. They penalize people for improving land while rewarding those who hoard it. A Land Value Tax (LVT) fixes this flaw at the root.

The idea is not new. Economist and social philosopher Henry George argued over a century ago that land, unlike labor or capital, is not created by individuals and should not generate private windfalls at public expense. As George famously wrote, “We must make land common property.” Not in the sense of abolishing ownership, but in recognizing that the value of land comes from society as a whole, not from the individual holding the deed.

A Land Value Tax taxes only the unimproved value of land—not the buildings, businesses, or homes on it. Under LVT, owning a vacant downtown lot becomes expensive, while building housing, shops, or workplaces is no longer punished. This flips incentives in exactly the direction society needs.

Property taxes discourage improvement. Renovate your home? Taxes go up. Build an apartment complex? Taxes go up. Start a small business on your land? Taxes go up. Meanwhile, someone sitting on an empty lot in a high-demand area can wait for prices to rise while contributing nothing. LVT ends this distortion. Improvements are untaxed. Speculation is not.

Henry George summed up the moral core of this idea clearly: “The land belongs to the people.” Land value rises because of public investment—roads, schools, infrastructure, population growth—not because of the landowner’s effort. Taxing that value simply returns publicly created wealth back to the public.

The economic benefits are substantial. LVT encourages efficient land use, reduces speculative bubbles, lowers housing costs, and increases development where it is actually needed. Cities become denser and more livable without relying on zoning gymnastics or endless subsidies. Unlike property taxes, LVT cannot be avoided by moving assets or hiding income. Land does not offshore itself.

Just as importantly, a Land Value Tax is an ideal mechanism for funding Universal Basic Income. UBI requires a stable, broad, and non-distortive revenue source. LVT fits perfectly. As land values increase—especially in thriving cities—the public captures that growth directly and redistributes it as a basic income. This creates a clean feedback loop: public investment raises land values, land values fund UBI, and UBI supports the people who make cities function.

George himself anticipated this connection between shared land value and shared prosperity, writing, “The rent of land is the natural fund for public purposes.” A modern UBI is simply a contemporary expression of that principle. Instead of redistributing after the fact through complex welfare systems, LVT funds a direct dividend from the commons.

Critics argue that LVT would hurt landowners. In reality, it hurts speculators, not productive users. Someone living in their home or operating a business benefits from lower taxes on improvements and greater economic stability from UBI. Those who profit by doing nothing but waiting for prices to rise are finally asked to contribute.

Replacing property taxes with a Land Value Tax also simplifies governance. Assessing land value is more transparent and less arbitrary than constantly re-evaluating structures. It reduces legal gamesmanship, lowers administrative costs, and makes tax burdens easier to understand. You pay for the value you monopolize—not for what you build.

A society that taxes work and rewards hoarding will always feel stagnant and unfair. A society that taxes unearned land value and distributes it back to its people aligns incentives with progress. LVT does not attack markets, property, or entrepreneurship. It restores balance.

Henry George’s insight remains strikingly modern: “The association of poverty with progress is the great enigma of our times.” A Land Value Tax, paired with Universal Basic Income, offers a clear answer. It ensures that as society grows wealthier, the benefits are shared—rather than fenced off behind deeds and speculation.

Replacing property taxes with a Land Value Tax is not radical. It is corrective. And it may be one of the cleanest ways to fund a future where economic security is a foundation, not a privilege.