Thursday, April 13, 2006

Surfing the net, I found this research paper from the Lincoln Institute of Land Policy. The piece focuses on whose taxes would go up or down under a split-rate tax system. The study looks at three Virginia communities: Roanoke City, Highfield County and Chesterfield County. One interesting finding was the benefits to homeowners: "In all three localities, the move to an equal-yield split-rate tax would reduce the residential share of the real property tax while increasing the business tax share." Not surprisingly, they found a significant tax increase on vacant land. In Roanoke (where Census data was available), they found that, within residential areas, lower-income residents tended to benefit more than higher-income residents.
While I appreciate the value of getting this information across, I am concerned that people will view split-rate tax as creating winners and losers. Fundamentally, I don't believe government should do that. I feel it to be an arbitrary violation of personal liberty. This is actually a major reason why I am so interested in split-rate taxation. Efficiency wins and inefficiency loses. Kind of like how the free market is supposed to work, because that's exactly what split-rate taxation does: create a healthier, more efficient market.
But efficiency isn't really going deep enough because, much as I like it, it doesn't really do that much for me. I love beauty, nature, romance, health, and children. And that's where split-rate taxes make the difference that I care about: making beautiful cities profitable, making it easy to get outside and relax, making exercise part of everyday life, helping us make more connections with each other, and helping us give a better world to our children.
What I mean is that, rather than going after one policy or another to solve all of our problems, we should be asking ourselves "How can our city be beautiful, healthy, vibrant?" And go from there.

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