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Evidence on the Distributional Effects of a Land Value Tax on Residential Households

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  • Plummer, Elizabeth

Abstract

This study examines how replacing a uniform property tax with a land value tax (LVT) would shift the tax burden for single-family residential properties in Tarrant County, Texas, over the period 1997–2006. Results suggest that a LVT would shift the tax burden away from single-family properties and on to other property classes. For the more recent years in the sample, the average tax liability for single-family properties would decrease about 30 percent, regardless of household income, and Suits Indices suggest that, within residential properties, a LVT would be slightly more progressive than a property tax. Horizontal equity problems would be greatest for the lowest-valued properties relative to other properties. This study also examines how a LVT would change property values due to the effects of tax capitalization.

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  • Plummer, Elizabeth, 2010. "Evidence on the Distributional Effects of a Land Value Tax on Residential Households," National Tax Journal, National Tax Association;National Tax Journal, vol. 63(1), pages 63-92, March.
  • Handle: RePEc:ntj:journl:v:63:y:2010:i:1:p:63-92
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    References listed on IDEAS

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    1. Poterba, James M, 1989. "Lifetime Incidence and the Distributional Burden of Excise Taxes," American Economic Review, American Economic Association, vol. 79(2), pages 325-330, May.
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    3. Bowman, John H. & Bell, Michael E., 2008. "Distributional Consequences of Converting the Property Tax to a Land Value Tax: Replication and Extension of England and Zhao," National Tax Journal, National Tax Association;National Tax Journal, vol. 61(4), pages 593-607, December.
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    Cited by:

    1. Kalkuhl, Matthias & Fernandez Milan, Blanca & Schwerhoff, Gregor & Jakob, Michael & Hahnen, Maren & Creutzig, Felix, 2017. "Fiscal Instruments for Sustainable Development: The Case of Land Taxes," MPRA Paper 78652, University Library of Munich, Germany.

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