1979/08/01 by Brian L. Bentick · 1 citation
Economics, Econometrics and Finance · #Fiscal Policy and Economic Growth #Housing Market and Economics #Economic theories and models #Renting #Valuation (finance) #Economics #Market value #Fair market value #Natural resource economics #Public economics #Property tax #Value (mathematics) #Easement #Business #Microeconomics #Tax reform #Finance
paper · doi:10.1086/260797
openalex publication_date 1979/08/01 · openalex created_date 2025/10/10 · openalex updated_date 2026/07/30
It is generally assumed that a tax on land ownership is always neutral toward resource allocation. Where land rentals change over time it is shown that the tax is neutral only where the tax base is current income as distinct from current market value. Taxes based on current market value are shown to favor investment projects with a short gestation period and to involve significant resource costs. These costs are considerably reduced if property appraisers, in assessing current market value, interpret the "highest and best use" of a property as that use which offers the greatest current income as opposed to its future income.