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Comment by tofukid | Hacker News Reader

Doesn’t that enable hostile takeover of land? If I own a school or restaurant, and Apple wants to replace it with a store, they can place a bid such that I can no longer afford the taxes and am forced to sell to them.

Wouldn’t such a system just exacerbate business and the wealthy being able to snatch up land?

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> they can place a bid such that I can no longer afford the taxes and am forced to sell to them.

Sell for multiples of the assessed value? What hardship!

Businesses can already purchase land for multiples of market value if they wish: very few people would refuse the offer. For the few that would, money clearly isn't a huge problem.

>For the few that would, money clearly isn't a huge problem.

That's not really true? A lot of people will refuse to sell their house even for a multiple of the 'market value', because that's the place they lived and want to continue living.

This isn't at all different to what happens today when a restaurant has its rent jacked up and it has to move.

The only difference is that instead of an individual landlord getting disgustingly rich out of dispossessing restaurants, the whole community gets a pile of cash.

The rich will be much more upset that they are exposed to the same market forces that the rest of us are than they will benefit from being able to dispossess others by offering to pay higher taxes.

The rich also wouldn't be nearly as rich if land stopped being an asset that could be capitalized. LVT would slash wealth inequality precisely because land is such a large component of wealth.

Hm, hostile in that you'd be forced to sell, yes. In theory, though, Apple has to put their money where their mouth is: they're not going to make an absurd offer out of spite, they're going to offer what they're willing to pay.

In that sense, this system would just a market alternative to property appraisal: allowing the market to decide the price of something that's not (currently) for sale.

Consider some numbers:

Let’s say that the bond rate is 2%, 1% goes to the bondholder, 1% goes to the treasury. Apple bonds the property of Joe’s plumbing for $1M with a 1 year duration. So Joe The Plumber either pays $10k a year to both Apple and the treasury, or takes $1M and moves.

If Joe can’t pay, then the banks will gladly lend against the property, because the payout is guaranteed. They will also very gladly lend for purchase of a new property for the same reason.

The system is actually no different to Joe. He still loses his property either way if he can’t pay the property tax. But now he has a liquid asset with zero transaction cost, so it works out a lot better for him either way.

And that 1% to the treasury could replace the entire income tax revenue of the country.

But it’s just an idea; there are things I’m not sure about.

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