Land Value Taxation: Theory, Evidence, and Practice

Land value tax (LVT) refers to a property tax scheme where a tax is imposed only on the value of a building's underlying land, and not the value of improvements (structural developments) that are made on the land. These tax schemes, when used in tandem or as substitutes to standard property taxes, can help cities encourage redevelopment of vacant land, prevent land speculation, and more equitably distribute tax burdens. This chapter from a broader book about LVTs outlines the economic theory behind (LVTs), provides a legal framework for implementation in the US, and highlights successful case studies. It also emphasizes how the political acceptability for an LVT proposal is crucial for the success of its implementation and includes recommendations for effectively communicating with stakeholders about the benefits of LVTs.