Mr. Lent, Chief of the Tax Policy Division, formerly served as assistant director of the tax analysis staff, U.S. Treasury Department; consultant, Organization of American States; and research associate, National Bureau of Economic Research, New York. He was on the faculty of the University of North Carolina and Dartmouth College.
David Ricardo, Principles of Political Economy and Taxation (first published 1817).
John Stuart Mill, Principles of Political Economy (Toronto, 1965), p. 819 (first published 1848).
Progress and Poverty, Book VIII, Ch. III (first published 1879).
For an excellent summary of the principles involved and their application, see Haskell P. Wald, Taxation of Agricultural Land in Underdeveloped Countries (Cambridge, Massachusetts, 1959), pp. 71–126.
Commission to Study the Fiscal System of Venezuela, The Fiscal System of Venezuela: A Report (Baltimore, 1959), p. 340, hereafter cited as the Shoup Commission Report. (The Commission consisted of Carl S. Shoup, Director; John F. Due; Lyle C. Fitch; Sir Donald MacDougall; Oliver S. Oldman; and Stanley S. Surrey.)
N. Kaldor, “The Role of Taxation in Economic Development,” in Problems in Economic Development, E.A.G. Robinson, ed., International Economic Association (London, 1965), p. 179, and Haskell P. Wald, “Reform of Agricultural Taxation to Promote Economic Development in Latin America,” in Fiscal Policy for Economic Growth in Latin America, papers and proceedings of a conference held in Santiago, Chile, December 1962, and issued by the Joint Tax Program of the Organization of American States, Inter-American Development Bank, and Economic Commission for Latin America (Baltimore, 1965), p. 326.
For an excellent historical analysis of the Australian and New Zealand property tax systems, see A.M. Woodruff and L.L. Ecker-Racz, “Property Taxes and Land Use Patterns in Australia and New Zealand,” The Tax Executive, Vol. XVIII (1965), pp. 16–63. See also Edwin R.A. Seligman, Essays in Taxation, 9th ed. (New York, 1921), pp. 516–31.
Woodruff and Ecker-Racz, op. cit., pp. 32–33.
For a brief history and critical appraisal of Canadian experience, see F.H. Finnis, “Site Valuation and Local Government,” Canadian Tax Journal, Vol. XI (1963), pp. 118–19.
For a good account, see Kjeld Philip, Skattepolitik (Copenhagen, 1965), pp. 476–88.
For a good survey, see John F. Due, Taxation and Economic Development in Tropical Africa (Cambridge, Massachusetts, 1963), pp. 102–18.
J.F.N. Murray, Report to the Government of Jamaica on Valuation, Land Taxation and Rating (Kingston, 1957). Murray recommended that a progressive rate be applied to the unimproved value of all lands held in one ownership. In addition, he recommended a flat rate based on capital value that would supplement the site-value tax.
For a review and appraisal of this experience, see Daniel M. Holland, “The Taxation of Unimproved Land Value in Jamaica,” in Proceedings of the . . . Conference on Taxation, 1965, National Tax Association (Harrisburg, Pennsylvania, 1966), pp. 442–70.
Richard M. Bird, “Local Property Taxes in Colombia,” in Proceedings of the. . . Conference on Taxation, 1965 (cited in fn. 13), p. 482.
Harvard Law School, World Tax Series: Taxation in Colombia (Chicago, 1964), pp. 138–40. These rates represent ceilings inclusive of all property tax rates except special assessments.
Bird, op. cit., p. 494.
Shoup Commission Report, p. 339.
See Dick Netzer, Economics of the Property Tax, The Brookings Institution (Washington, 1966), p. 209.
J.R. Hicks and U.K. Hicks, Report on Finance and Taxation in Jamaica (Kingston, 1955), p. 137.
Holland, op. cit.
Murray, op. cit., p. i.
Finnis, op. cit., p. 119.
Woodruff and Ecker-Racz, op. cit., p. 62.
J.R. and U.K. Hicks, op. cit., p. 139.
Holland, op. cit., p. 449.
Woodruff and Ecker-Racz, op. cit., p. 58.
J.R. and U.K. Hicks, op. cit., p. 134.
Murray, op. cit., p. 6.
Woodruff and Ecker-Racz, op. cit., pp. 58 and 62–63.
Due, op. cit., pp. 102–18.
Ibid., p. 118.
One of the few systematic comparisons of the alternative systems of property taxation in the United Kingdom was made by the Committee of Enquiry of the Ministry of Housing and Local Government on the Rating of Site Values, over a five-year period, 1947–52. Although a majority of the Committee declared against a site-value system, the minority supported it. Skepticism about the merits of site valuation, which apparently originated in institutional and legal factors, is evidenced by the following excerpts from the majority report: “On the main issue before us of whether the imposition of a site value rate is practicable or desirable, the great preponderance of evidence was opposed to the introduction of such a rate, and we were impressed by the reasoned arguments both in regard to its undesirability and the practical difficulties in respect of its application” (Ministry of Housing and Local Government, Scottish Home Government, The Rating of Site Values: Report of the Committee of Enquiry (London, 1952), p. 72). The Committee took as its terms of reference the Town and Country Planning Act, 1947 (described in the Appendix), which limited its consideration to value in use. The Committee concluded that “the only effect of a site value rate on existing use value would be a shift of burden as between individuals and classes of property,” but that there was “no evidence that there would be either advantage or equity in altering the relative amount of rates borne by those classes of property or persons” (ibid., p. 76). Moreover, the Committee was impressed by the administrative difficulties, the prospects of litigation, and the undesirability of diverting much-needed manpower for the relatively small revenues involved. The minority report, however, concluded that “the rating of site values is both practicable and desirable” (ibid., p. 97), and charged that the majority’s adherence to a concept of “the existing-use value” vitiated the conclusions reached (ibid., p. 77).
See Woodruff and Ecker-Racz, op. cit., p. 34.
For a good description of this and similar German taxes, see Seligman (1921), op. cit., pp. 505–15. On the enactment of the imperial tax referred to below, see Gustav Cohn, “Taxation of Unearned Increment in Germany,” The Economic Journal, Vol. XXI (1911), pp. 212–22, and Karl Bräuer, “Wertzuwachssteuer (Grundstücksgewinnsteuer),” in Handwörterbuch der Staatswissenschaften, Vol. VIII (Jena, 1928), pp. 1017–42.
J.C. Stamp, “The Incidence of Increment Duties,” The Economic Journal, Vol. XXIII (1913), p. 201.
Gustav Cohn, “German Experiments in Fiscal Legislation,” The Economic Journal, Vol. XXIII (1913), pp. 544–45, and Edwin R.A. Seligman, “Comparative Tax Burdens in the Twentieth Century,” Political Science Quarterly, Vol. 39 (1924), pp. 124–25.
T. Pistorius, “Direkte Zuwachs- und Kriegsgewinnsteuer,” in Handbuch der Finanzwissenschaft, Vol. 2 (Tübingen, 1927), p. 175. In 1919, a special tax was imposed on individuals on the increment of all property value (Kriegsabgabe vom Vermögenszuwachs), graduated from 10 per cent on the first DM 10,000 to 100 per cent on increases over DM 375,000 (ibid.).
H. Ronald Parker, “The History of Compensation and Betterment since 1900,” in Land Values: The Report of the Proceedings of a Colloquium Held in London on March 13 and 14, 1965, Under the Auspices of the Acton Society Trust, Peter Hall, ed. (London, 1965), pp. 65–72. See also Seligman (1921), op. cit., pp. 491–94.
The Rating of Site Values . . . (cited in fn. 32), p. 20.
See Philip, op. cit. This tax evolved out of the “railroad levy” introduced in 1910 to tax increases in land value induced by the railroad. It was made available to municipalities in 1926.
See Appendix, p. 116, for a more detailed review.
Central Land Board: Report for 1950–51, House of Lords Papers and Bills (London, 1951).
Minister of Land and Natural Resources and the Secretary of State for Scotland, The Land Commission, Cmnd. 2771 (London, 1965), hereafter cited as The Land Commission, Cmnd. 2771.
Harvard Law School, World Tax Series: Taxation in Italy (Chicago, 1965), pp. 265–70.
Bulletin for International Fiscal Documentation (Amsterdam), Vol. XVIII (1964), pp. 13–14. The law was amended in 1963 because of widespread evasion of the original tax, which was based on transfer of legal ownership via registration with the Land Registry Office. Speculative transactions remained untaxed because of failure to register the transfer. The new tax applies to the mere transfer of contractual rights in land.
E.W. Klimowsky, “Capital Gains Taxation in Israel—Modifications,” Bulletin for International Fiscal Documentation, loc. cit., p. 455.
For a review of these problems and conditions for a successful program, see P.H. Clark, “Site Value Rating and the Recovery of Betterment,” in Land Values. . . (cited in fn. 38), pp. 73–96.
Seligman (1921), op. cit., p. 414.
Report from the Select Committee of the House of Lords on Town Improvements (Betterment), 1894 (cited by Seligman (1921), op. cit., p. 433). The Uthwatt Report (Expert Committee on Compensation and Betterment, Final Report, Cmd. 6386 (London, 1942)) attempted to expand the concept of betterment to include the “enhancement in the value of property arising from general community influences, such as the growth of urban population” (pars. 260 and 276). This study follows the more restricted concept.
Victor Rosewater, Special Assessments: A Study in Municipal Finance (New York, 1893), p. 9.
International City Managers’ Association, Municipal Finance Administration, 6th ed. (Chicago, 1962), hereafter cited as Municipal Finance Administration, p. 114.
Ley de Expropiación por Causa de Utilidad Pública o Social.
Shoup Commission Report, p. 337.
Joint Tax Program of the Organization of American States and the Inter-American Development Bank, Fiscal Survey of Colombia (Baltimore, 1965), p. 136.
Bird, op. cit., p. 492.
Fiscal Survey of Colombia (cited in fn. 54), p. 140.
George Break and Ralph Turvey, Studies in Greek Taxation, Center of Planning and Economic Research (Athens, 1964), p. 82.
Municipal Finance Administration, pp. 111–30.
The Municipal Year Book, 1959 reported that 570 of 835 reporting cities use the method exclusively, and 183 use a combination of footage and area (ibid., p. 121).
Cf. Bird, op. cit., p. 492.
Municipal Finance Administration, p. 114.
See International Bank for Reconstruction and Development, The Use of Special Assessments to Finance Development Projects, Appendix I (unpublished mimeographed paper, July 15, 1953).
See E.H. Jacoby, “Problems of Land Taxation,” Information on Land Reform, Land Settlement and Co-operatives, Food and Agriculture Organization, No. 2 (Rome, 1965), pp. 9–10.
Prepared by Carl-Heinz Tretner, economist in the Fiscal Affairs Department. Mr. Tretner studied at the University of California in Los Angeles, the Institut d’Etudes Politiques in Paris, and the University of Cologne, where he was an assistant. Before joining the Fund staff, he was assistant treasurer with the German branch of an international oil firm.
The Land Commission, Cmnd. 2771.
The Rating of Site Values . . . (cited in fn. 32), p. 26.
The Economist, May 10, 1947, p. 701.
The Economist, May 14, 1949, p. 881.
The Economist, November 15, 1952, p. 433.
Central Land Board . . . (cited in fn. 42).
Parker, op. cit., pp. 65–67 and 71.
The Land Commission, Cmnd. 2771, p. 4.
See Alan Day, “The Case for Betterment Charges,” in Land Values . . . (cited in fn. 38), p. 100.
The Economist, November 15, 1952, p. 433.
The Land Commission, Cmnd. 2771, sec. 29.
Loc. cit., sec. 26.
“Land Commission Proposals,” The Financial Times (London), October 21, 1965, p. 20.
House of Commons, Parliamentary Debates, Weekly Hansard, No. 671, November 8–11, 1965, col. 372, and No. 687, March 6–12, 1966, cols. 606–732.
Loc. cit., No. 671, November 8–11, 1965, col. 483.
The Financial Times, September 23, 1965.
House of Commons, Parliamentary Debates, Weekly Hansard, No. 671, November 8–11, 1965, col. 398.