Two-Rate Property Tax Effects on Land Development
AbstractEconomists have long understood that the conventional property tax causes the housing stock to be smaller than it would be in the presence of a nondistortionary tax such as a land or site value tax. This article brings together the results from models of housing development timing and structural density with the results of a modern model of a graded property tax in an urban setting. The combination of results is used to investigate the effects of a community's movement from a property tax to a two-rate tax system where land is taxed at a higher rate than structures. The conditions under which increasing reliance on a land or site value tax will increase housing structural density and speed of development are identified and examined. Policy implications are drawn. Copyright 1999 by Kluwer Academic Publishers
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Bibliographic InfoArticle provided by Springer in its journal Journal of Real Estate Finance & Economics.
Volume (Year): 18 (1999)
Issue (Month): 2 (March)
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Web page: http://www.springerlink.com/link.asp?id=102945
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- Jyh-Bang Jou & Tan Lee, 2008. "Taxation on Land Value and Development When There Are Negative Externalities from Development," The Journal of Real Estate Finance and Economics, Springer, vol. 36(1), pages 103-120, January.
- John Anderson, 2005. "Taxes and Fees as Forms of Land Use Regulation," The Journal of Real Estate Finance and Economics, Springer, vol. 31(4), pages 413-427, December.
- Lyytikäinen, Teemu, 2009.
"Three-rate property taxation and housing construction,"
Journal of Urban Economics,
Elsevier, vol. 65(3), pages 305-313, May.
- Teemu Lyytikäinen, 2007. "The Effect of Three-rate Property Taxation on Housing Construction," Discussion Papers 419, Government Institute for Economic Research Finland (VATT).
- Jyh-Bang Jou & Tan Lee, 2008. "Neutral Property Taxation Under Uncertainty," The Journal of Real Estate Finance and Economics, Springer, vol. 37(3), pages 211-231, October.
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