Better Assessments & Better Incentives
Driving sustainable and equitable growth through fair tax policy.
The Center for Land Economics advances property tax reforms that promote equitable assessments and foster fair development.
Better Assessments
Property taxes should be fairly assessed and transparent.
Two similar properties should not have large variations in assessments that create inequitable tax bills. At the same time, assessments should accurately reflect the differences between properties. Property in more desirable locations should be assessed higher than those in less desirable locations. Assessments should be easy to access and evaluate for accuracy.
We help local governments understand and evaluate their property assessments.
Better Incentives
Property taxes punish development.
Every new building, new unit, and renovation faces higher taxes. Meanwhile, landowners can speculate on vacant or underutilized land as value appreciates. We must find a way to align incentives, so landowners are encouraged to build and discouraged from idleness.
We can split property taxes.
While keeping revenues neutral, we can split the property tax into two components:
One on land
One on improvements to the land
Improvements will be valued based on the buildings and other development on top of the land. Land will be valued solely based on location. Location in urban centers has higher demand, and therefore higher prices.
Shifting the burden onto land aligns incentives.
Reward productivity, discourage passivity.
By decreasing the rate on improvements, landowners can develop bigger and better. By offsetting decreased revenue through an increased rate on land, landowners will profit less from idleness, encouraging land to be put to good use.
In the News
Could the Land Value Tax Solve the Housing Shortage?
