Land Value Taxation – for a vital country side, wildlife, climate and economy

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Land Value Taxation (LVT) wouldn’t just create job opportunities och support an economy regeneratively. It is also the key to protection of wildlife, biodiversity and austereness of resources. The LVT system make sure we are all sharing these resources of nature. Either through physical access to them or by economic compensation from others’ use, extraction and pollution. That sustains a greater feeling of coherency and communion in a society and respect for Nature.

Natural Capital

The funding of a government, a state, should derive from the Natural Capital, that is the gifts of Nature. These are often called Ecosystem Services today, but the understanding of this concept might not be totally clear. Todays’ tax system permits privatization of the monopoly value of these, without taxing them. This over time leads to a concentration of unearned income, so called Free Lunches, to a handful of people. It also leads to reduction of the economy’s effectiveness.

vacantlotWhen a society progress and becomes ever more wealthy, the Natural Capital will constitute an ever larger share of the total wealth, since they are finite resources. But the monopoly value will also be handed to ever fewer people, most often banks, landlords and improductive financial speculators. They “catch” the economic value (economic rent in this terminology) which we all without exception contribute to just by existing. And they make huge profits from this. In this way entrepreneurship and the productive members of the society are massively drained.

A fee on the use of the Natural Capital have got a much bigger positive effect on economy than taxes on labor and trade. These are directly damaging. The LVT (the fee that is) stimulates both work and industry and at the same time as the protection of the lands  and nature resources continually strengthens.

A couple of other effects we’ll see is that land already in use will be more efficiently used, investments in the poor areas, the sprawl of the cities over fertile soil seizes. The construction will be more vertical and unused city spaces (vacant lots) will come into production. Green energy is the obvious choice. Poverty decreases and the national wealth redounds to the citizens.

Value to wildlife

As soon as one of the gifts of Nature are “destroyed”, e.g. lands are taken, minerals or oil extracted or deforestation, the value of the remaining resource are increased. A fee (LVT) would be the consequence of the extraction. Through this fee we’ll make sure that what we take, we use as effectively as possible. We will also give back the lands we do not need  and this is how we create more wildlife and the biodiversity exponetially arise from the ashes.

Creation of work opportunities in rural areas, agriculture and nature conservation

In todays’ system we support the development to more intense methods in agriculture, unnecessary suffering of animals, oil based chemical use and urbanization of people and money. Fuel, fertilizers and chemical pesticides are under huge subsidies and doesn’t reflect the true cost of society and environment.

biodynamicfarmerIf we abolish the taxes on labor and trade, we’ll create more jobs, and even more so, we’ll see more balance between the cities and the rural areas. Many will choose to settle outside of the cities. The most economical methods in farming will be used, that is, the organic approach. More people at the country side, and more producing food. Enterprises within tourism and wildlife guiding are probably some other effects. The reconnection of nature increases altogther.

Why other systems has failed

There’s been many attempts to support wildlife and protect the resources. Raised taxes as a consequence. Many of these attempts has had small gains and only led to higher land prices and more wealth to landlords. Grants to the landlords, subsidies for agriculture and policy for how we use the lands are a catastroph for wildlife and biodiversity.

Conclusion

The LVT system is commonly known within the new academic movement of Climate Economy as the only system that ensures a growing economy with increased employment, protection of biodiversity, wildlife and nature resources. It is also supported by the foremost economists the last couple of centuries. A Norwegian investigation 2013 concluded that a nation should primarily be funded through a LVT. Quote: “A known result from tax theory is that a tax that corrects external costs should be the nations first source of income. (E.g. if you pollute you pay). These taxes creates desired adjustments which improves the function of the economy. But these taxes are rarely enough so economic rent (Jordränta in Swedish) taxes should be the second income source. (Economic rent is an unearned income for the landlord produced by nature and the surrounding society. Every shop, road, school or whatever, increases the economic rent. In theory economic rent taxes doesn’t create distorsions or influence the efficiency of economy. When the potential of external correcting taxes and economic rent taxes are exhausted, only then the nation should use taxes on labor, VAT etc since these taxes creates unwanted changes and affects the economy negatively.” Note that the burden of taxation doesn’t increase, it’s only a shift in deriving sources.

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