patrick.net

Reality says

Speaking like a true believer of the insane. Do you realize, your ideal of "fairness" is indeed an end state fantasy (like Communism), as in: we will all be equal when we are dead and buried, equally dead!

Meanwhile, we all have some living to do.

I wasn't sure about answering, since it's something so stupid what you said that you probably realized soon after saying it. Anyway, I think it's clear that my concept of fair is not everybody being equal, but all our chosen activities being equally taxable in front of the government. Unless externality can be proven, it should be equally taxable if you build chairs or you bake bread.

ja says

I'm saying it's better for 2 women to get raped

That's where you lost me.

Regarding taxing imputed rents, it makes no sense to me due to this - one of the biggest motivators in america to buy a pad is to avoid paying rent especially when buy/rent ratios are in favor of buying and/or to create an inflation hedge. Taxing the so called imputed rent basically means that you are still paying part of that rent via marginal rate and you still have to pay the mortgage! That's a double whammy. No wonder only around 35% of swiss own a home. It is very hypocritical of them to do that especially when they have developed a reputation as a worldwide tax shelter for everyone else.

ja says

mell says

What if I buy stocks for myself with money that has already been income taxed? Why should I pay when I sell them for a gain?

Because you increase your total assets (i.e. income). That's the principle of income tax.

What about a person that increases their income by 1 million because another person gives that amount of post-tax money to them? How do you justify double taxation?

ja says

You are confusing income/money with value. Money is just a proxy (i.e. convenience) to transfer value. You could use a credit system to get paid when you cook to a neighbor, and paid with that credit when a neighbor cooks for you. This is almost barter economy, and it avoids paying tax, at the expense of being inefficient and using a currency with limited scope.

If you get paid for cooking for your neighbor as a form of barter, of course you are liable to income tax. The key is BEING PAID (and having a profit)! The payment doesn't have to be money; you are liable to income tax so long as it is quid pro quo. Cooking for oneself however does not at all constitute income liable to taxation, as there is no income. Nor does informal backyard BBQ's where nobody is earning a profit.

ja says

Read my comment. I'm saying it's better for 2 women to get raped once that for 1 women to get raped twice. IT's not a good example, but in a generic sense, it just means to share the costs.

Only because you are an idiot male who does not at all understand the psychological damage done to rape victims.

BTW, I'm a man too, and I date women. I also understand the less basket cases out there the better, for women and men who like them.

Your comment make you sound like a moronic dork who doesn't understand the chip you advocate would make things far worse than even the tax collection itself.

ja says

I think it's clear that my concept of fair is not everybody being equal, but all our chosen activities being equally taxable in front of the government.

In front your imaginary Government-God. Your chip idea is so reprehensible, I don't even know where to begin. Do you think the government is staffed by godly saints, or by pimply faced morons just like you or your classmates? If you have a sister or girlfriend, do you really want some pimply faced dork be able to pull up where she's been buying her panties and having her hair waxed just by a few key strokes?

I have a better counter-plan.

Do not have a mortgage deduction or a building tax at all. Instead tax land. For residential land, tax the first 0.25 acres at 0.25%, the second 0.25 at 0.50%, the third at 0.75%, the fourth at 1.00%, and so on, even past 100%.

Consider all land owned by a household over the entire country. Average out the tax rate, rather than letting the tax payer or IRS "choose" which is the first acre, etc.

Use a similar technique for commercial, industrial, and farm land.

This will allow each household to afford basic shelter, but progressively higher tax wealth and opulence.

It's impossible to calculated the price of land under existing buildings and improvements. The assessor's numbers are typically just numbers pulled out their asses, and people don't waste time dispute them much only because the buildings and land are usually taxed at the same rate in a given town/city, and most homeowners do not depreciate their own homes in tax filings. This is the fundamental flaw with Georgism. Henry George himself changed the definition of "land" during his career, because the abstract concept is simply untenable in the real world.

Some land parcels, especially farms, mines and woodlots, need to be large enough size in order to allow mechanization. Breaking up farm land holdings into tiny pieces is not in anyone's interest; anyone who needs to eat anyway.

It's impossible to calculated the price of land under existing buildings and improvements. The assessor's numbers are typically just numbers pulled out their asses

I was at the beach last year and saw an empty lot for sale, in identical size to their neighbors (who happened to have a nice house built on theirs). It was for sale for 1 million $. I figure it safe to assume that the sand lot underneath that house was worth about the same as the neighbors.

I'm not sure you understand the meaning of the word "impossible".

Funny how people are A OK with millage being high on RE buildings when it comes to property taxes, so long as they go to the school district. Suggest lowering millage on buildings/improvements, and countering with higher millage on land values, and people throw a fit

errc says

I was at the beach last year and saw an empty lot for sale, in identical size to their neighbors (who happened to have a nice house built on theirs). It was for sale for 1 million $. I figure it safe to assume that the sand lot underneath that house was worth about the same as the neighbors.

Situations like that are extremely rare for built-up areas. BTW, for most sandy beach lots in this country, the empty lot would not even be considered "land" in the strict Georgist sense, as the sand beach has to be maintained every 10-20 years. What you see in the empty lot is actually both "land" and improvement (refilling, and levies/break water retaining sand on the beach)

Funny how people are A OK with millage being high on RE buildings when it comes to property taxes, so long as they go to the school district. Suggest lowering millage on buildings/improvements, and countering with higher millage on land values, and people throw a fit

Because buildings with land lots are frequently traded, whereas empty lot transactions take place much much less frequently in built-up areas, where most property value is located.

Well, insurance companies make their living evaluating the cost to replace the structures that they insure, ground up. So wouldn't assessed value of an entire piece of RE, minus the cost to replace the structure(s) yield a decent estimate of the actual value of the underlying parcel of land?

errc says

Well, insurance companies make their living evaluating the cost to replace the structures that they insure, ground up. So wouldn't assessed value of an entire piece of RE, minus the cost to replace the structure(s) yield a decent estimate of the actual value of the underlying parcel of land?

I wish ;-) The insurance co replacement cost quote is higher than the entire purchase price for every single building/house that I have bought. I'd love to have all the land lots that I own taxed at negative value, and zero tax on the buildings. LOL.

B.A.C.A.H. says

I wish that only US citizens could get the mortgage interest deduction.

I wish only US citizens had to pay taxes in the US.

Reality says

errc says

Well, insurance companies make their living evaluating the cost to replace the structures that they insure, ground up. So wouldn't assessed value of an entire piece of RE, minus the cost to replace the structure(s) yield a decent estimate of the actual value of the underlying parcel of land?

I wish ;-) The insurance co replacement cost quote is higher than the entire purchase price for every single building/house that I have bought. I'd love to have all the land lots that I own taxed at negative value, and zero tax on the buildings. LOL.

Right. I think my homeowners insurance values the structures replacement cost at around 200k, yet the taxman values the real estate at 125k. Does this hold true for a mcdonalds at times square?

Insurance is valuating at replacement cost, but my house is sixty years old, so there's. Depreciation to consider

Depreciation and insurance co's propensity to over-estimate (they are selling a product, why not sell you more than you need) make the insured replacement cost higher than the property's value for most houses in this country . . . so it's no help for estimating land value at all.

Reality says

Depreciation and insurance co's propensity to over-estimate (they are selling
a product, why not sell you more than you need) make the insured replacement
cost higher than the property's value for most houses in this country . . . so
it's no help for estimating land value at all.

Poor logic. Just because something isn't perfect does not mean it has no value. It would seem pretty easy to develop a method to remove the insurance companies systemic error.

tatupu70 says

Poor logic. Just because something isn't perfect does not mean it has no value. It would seem pretty easy to develop a method to remove the insurance companies systemic error.

Do you also happen to hold the old soviet belief that if the bureaucrats had powerful enough computers, they could calculate the prices for everything? at least how much they "ought to" cost? LOL

Reality says

Do you also happen to hold the old soviet belief that if the bureaucrats had
powerful enough computers, they could calculate the prices for everything? at
least how much they "ought to" cost? LOL

Nice dodge. lol is right.

I'm not exactly sure how this works

http://en.m.wikipedia.org/wiki/Robin_Hood_plan

But I imagine they somehow managed to overcome similar problems? Or did they not bother decoupling land values from the physical structures?

http://www.tea.state.tx.us/index2.aspx?id=6796

Just a ways up the road from my locale, harrisburg has managed to implement

http://www.earthrights.net/docs/success.html

It's not a dodge. I was merely pointing out the absurdity of postulating some kind of artificial formula can tease out the value of a building from insurance replacement value. I hope you do realize that insurance agents don't even go inside the building (or even outside the building) before they give you replacement values. The typical tax assessor actually go visit buildings.

Reality says

I was merely pointing out the absurdity of postulating some kind of artificial
formula can tease out the value of a building from insurance replacement value.
I hope you do realize that insurance agents don't even go inside the building
(or even outside the building) before they give you replacement values. The
typical tax assessor actually go visit buildings.

Sure, and I was merely pointing out that just because something is difficult does not mean it is impossible. Valuing land is not impossible.

No one really knows how those proposals work. My guess is that so long as the overall tax burden doesn't change much, they are operating on the tax base' benign neglect/tolerance. Some of them are "working" in the sense that nobody has showed up at the assessor's office with a pitchfork, yet.

If a Beazer built 3/2 1800 sq ft house, more or less identical in design and material, sells for 700k in san francisco, and 200k in lancaster, on identical sized lots, is it not safe to say that the sf land was 500k more valuable then the lancaster land?

This is the information age, and there's plenty of data out there to compare. I think it quite absurd to say that it is "impossible" to valuate land seperate from buildings on a piece of RE

In case it is not obvious, a typical builder build different houses in different towns. The $700k house and the $200k house are most likely very different, despite being built by the same home builder. Around where I live, even the $1.5mil house and the $800k houses built by the same builder in two towns 40 miles away from each other are very different.

On top of that, lots in the same town have different values, even if identical in size. There is a reason why typical lenders only accept house sales located within a mile as "comparable sals."

mell says

What if I buy stocks for myself with money that has already been income taxed? Why should I pay when I sell them for a gain?

So you think that income should only be taxed if you work for it? (I actually think the opposite) So it is fine for a teacher to pay taxes on hard earned wage but if a rich kid is living off of mommy and daddy's investments we should not tax them?
Capital gains is already taxed a a way lower percentage than income tax.

I am sure that you are aware that you did not have to invest that money and make a profit, you could always just keep that money in your pocket and not have been taxed.

Oh, and why are you not complaining about bad investments being used as tax write-offs (since you already paid taxes on them).... hypocrite.

evilmonkeyboy says

mell says

What if I buy stocks for myself with money that has already been income taxed? Why should I pay when I sell them for a gain?

So you think that income should only be taxed if you work for it? (I actually think the opposite) So it is fine for a teacher to pay taxes on hard earned wage but if a rich kid is living off of mommy and daddy's investments we should not tax them?

Capital gains is already taxed a a way lower percentage than income tax.

I am sure that you are aware that you did not have to invest that money and make a profit, you could always just keep that money in your pocket and not have been taxed.

Oh, and why are you not complaining about bad investments being used as tax write-offs (since you already paid taxes on them).... hypocrite.

First the write-offs are capped per year which renders large losses factually unable to be written off. Secondly we have all this QE because (according to the resident board economists) we don't have enough money in circulation. Instead you could encourage circulation by not disadvantaging investors in general or one (stock buyer) over another (home buyer). You'd have plenty of circulation without having to counterfeit money and giving it to the first in line crony capitalists/lobbyists while the middle-class suffers from resulting inflation. Third, do you think there is any justification if people gift each other after-tax money (or valued assets) to take a significant piece of that gift every time that happens just because their income/wealth increases? Looks like robbery to me. I am also for lowest possible (ideally none) income tax (for the teacher and everybody else as a flat tax), but it's not logical to demand higher taxation on gains for after-tax invested money just because income taxes happen to be high.

evilmonkeyboy says

So you think that income should only be taxed if you work for it? (I actually think the opposite) So it is fine for a teacher to pay taxes on hard earned wage but if a rich kid is living off of mommy and daddy's investments we should not tax them?

If the Fed would stop interfering we would not have an ever rising inflation asset bubble and you cannot simply live off of investments that you never change, the market would be far more dynamic. That rich kid is also constantly spending money to support its lifestyle. We need consumers that actually have money to buy the useless shit they want, not those who default later on.

evilmonkeyboy says

I am sure that you are aware that you did not have to invest that money and make a profit, you could always just keep that money in your pocket and not have been taxed.

Sure, but that hasn't been a wise choice since the Fed is rendering your money worthless by counterfeiting moar and moar $$, jacking up the prices for almost everything. I'd have no problems letting that money conservatively sit in a savings account and yield a couple of %, unfortunately the yield is below a percent and inflation around 5%. So the only options are to spend or invest it. Or you can hope that deflation will come eventually and be pissed on by the resident patnet economists ;)

Reality says

In case it is not obvious, a typical builder build different houses in different towns. The $700k house and the $200k house are most likely very different, despite being built by the same home builder. Around where I live, even the $1.5mil house and the $800k houses built by the same builder in two towns 40 miles away from each other are very different.

On top of that, lots in the same town have different values, even if identical in size. There is a reason why typical lenders only accept house sales located within a mile as "comparable sals."

Huh? It was hard to make sense of whatever point you are trying to make, while speaking with that chinese finger trap stuck to your tongue.

Let me decomplexify the questtion for you.

Identical house, identical lot, sells for 500k more in SF then it does in lancaster. Why?

errc says

Identical house, identical lot, sells for 500k more in SF then it does in lancaster. Why?

You have to show us Beezer is actually building two identical houses at the two locations like you claim. My point was simply that you are making sh*t up.

Beezer is not so clueless as to build identical houses and sell one at $700k in one place, and $200k in another location. There is opportunity cost to Beezer's employees and equipment.

Reality says

BTW, I'm a man too, and I date women. I also understand the less basket cases out there the better, for women and men who like them.

So I understand you prefer the same women being raped twice. How do you choose that woman?

Reality says

If you get paid for cooking for your neighbor as a form of barter, of course you are liable to income tax. The key is BEING PAID (and having a profit)! The payment doesn't have to be money; you are liable to income tax so long as it is quid pro quo. Cooking for oneself however does not at all constitute income liable to taxation, as there is no income. Nor does informal backyard BBQ's where nobody is earning a profit.

Then I guess you changed your mind. And if I cook for a friend and he later cooks for me as return the favor, we both should be taxed.

And, at the end, with this tax system it's better to produce and consume for yourself = no economy at all

errc says

Identical house, identical lot, sells for 500k more in SF then it does in lancaster. Why?

purely marketing, regardless of cost. something you learn in marketing 101... its the same with many labeled vs generic products like Tennis Shoes.. i mean stick a Nike or some name on it .. but its still some $20 shoes coming from the same factory.

For homes.. it need not be identical looking.. same quantity of material and labor used. A beazer home in SFBA migh be $500K while equal home is less than half elsewhere.

evilmonkeyboy says

So you think that income should only be taxed if you work for it? (I actually think the opposite) So it is fine for a teacher to pay taxes on hard earned wage but if a rich kid is living off of mommy and daddy's investments we should not tax them?

Capital gains is already taxed a a way lower percentage than income tax.

Some republican idiot said during last elections that we need to tax capital gains at a lower rate so investors get compensated for their risk.

The official answer is that lower capital gains incentive investment vs consumption (government knows better what to do with your money than you).

But the reality is that all countries have lower capital tax rate because capital, unlike people, is flexible, and can fly from our country to another one.

Reality says

Do you also happen to hold the old soviet belief that if the bureaucrats had powerful enough computers, they could calculate the prices for everything? at least how much they "ought to" cost? LOL

Or whether or not you are declaring all your income? Oh.. wait, actually IRS has algorithms to help them with that. As long as you have good models, society can be engineered for the benefit of all.

ja says

Some republican idiot said during last elections that we need to tax capital gains at a lower rate so investors get compensated for their risk.

The official answer is that lower capital gains incentive investment vs consumption (government knows better what to do with your money than you).

But the reality is that all countries have lower capital tax rate because capital, unlike people, is flexible, and can fly from our country to another one.

as was the case when many companies actually modernized their workforce with IT equipment.... and there came the PC/Computing/Networking boom... it certainly created a boom in Silicon Valley... we hired everyone in sight and then some.

ja says

BTW, I'm a man too, and I date women. I also understand the less basket cases out there the better, for women and men who like them.

So I understand you prefer the same women being raped twice. How do you choose that woman?

Ever heard of diminishing return? The same women raped twice results in one rape victim. Two women each raped once result in two rape victims.

On top of that, the total sum is never the same: the chips that you advocate implanting into people's necks constitute extra raping, and all the pimply faced fools that need to be hired to staff the extra taxation enforcement would result in even more raping.

ja says

Reality says

If you get paid for cooking for your neighbor as a form of barter, of course you are liable to income tax. The key is BEING PAID (and having a profit)! The payment doesn't have to be money; you are liable to income tax so long as it is quid pro quo. Cooking for oneself however does not at all constitute income liable to taxation, as there is no income. Nor does informal backyard BBQ's where nobody is earning a profit.

Then I guess you changed your mind. And if I cook for a friend and he later cooks for me as return the favor, we both should be taxed.

Where did I change mind? You are free to volunteer payment / donation to the tax authority. Cooking in turn is not even per se quid pro quo; on top of that, there is no profit to be taxed. You are just being silly, but if you prefer making extra donations to the tax authorities, it's your own problem.

And, at the end, with this tax system it's better to produce and consume for yourself = no economy at all

Which tax system? Most tax systems do the blood sucking at points where division of labor takes place, as division of labor results in significant increase in productivity (i.e. profit over the opportunity cost of doing things by oneself).

ja says

Reality says

Do you also happen to hold the old soviet belief that if the bureaucrats had powerful enough computers, they could calculate the prices for everything? at least how much they "ought to" cost? LOL

Or whether or not you are declaring all your income? Oh.. wait, actually IRS has algorithms to help them with that. As long as you have good models, society can be engineered for the benefit of all.

What are you talking about? I take it you didn't know that the soviets believed, according their Marxist Labor Theory of Value, everything had a "fair price" independent of the consumer whims: the bureaucrats with computing power and, yes, models, were the best at setting prices for everything! Yes, they did mean everything, from houses to cars, to shoes to nylon stockings! Fashion and brand be damned.

The result was of course chaos: empty shelves for items that people wanted, overstocks of items that people did not want.

What the Labor Theory of Value failed to recognize is that the market price mechanism is a signal transmission system: transmitting from one participant to another what to produce according to the latest new discovery (which is always localized). A market transaction takes place when two parties disagree on the relative value of the two items being exchanged (one of which can be money); they agree on the exchange but disagree on the relative valuation.

Reality says

Beezer is not so clueless as to build identical houses and sell one at $700k in one place, and $200k in another location. There is opportunity cost to Beezer's employees and equipment.

Of course they would. The difference is the value of the land underneath the house. They have to buy the land before they can build on it.

thomaswong.1986 says

purely marketing, regardless of cost. something you learn in marketing 101... its the same with many labeled vs generic products like Tennis Shoes.. i mean stick a Nike or some name on it .. but its still some $20 shoes coming from the same factory.

For homes.. it need not be identical looking.. same quantity of material and labor used. A beazer home in SFBA migh be $500K while equal home is less than half elsewhere.

Again--the difference is the value of the land. Land is expensive in the BA or Manhattan. Not so expensive in rural America. Therefore the same house might have very different costs depending on where it was built. Same margin for the builder, but different price.