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Closer to Reason?

For years I have been an irrationally fervent proponent of abandoning our aged, flawed, punitive tax systems that try(and fail) to exploit people who accomplish responsible things like owning property, buying things, and having a job. These systems are especially damaging to the poor, for whom "paying their fair share," can mean the difference between supporting their families or living in poverty. I personally this that this unfairness outweighs any responsibility that they supposedly should have for supporting our society's infrastructure, especially in light of the fact that the very systems that taxes pay into are often used to attempt to keep these people from falling off the brink. It winds up costing everybody else money anyway.

A St. Louis-based thinktank has, through the contribution of the mind of a professor of economics at the University of Missouri in Columbia named Joseph Haslag, offered an alternative to one of Kansas City's many ridiculous ineffectual taxes. Anyone who lives or works in Kansas City pays one percent of their annual income to the city.

They try to distinguish it from income tax by name only, by calling it the "Earnings Tax," but it's an income tax. Everyone pays it, regardless of their income, and many locals rejoice when they find a job outside the city, meaning they're no longer saddled with it. Haslag has proposed phasing the earnings tax out over a period of ten years, through the gradual implementation of an land tax.

I first spotted the news on the kcrag forum, where a user pointed to an article in the Kansas City Business Journal, breaking the story of the 28-page report written by Haslag. The next day, the Star ran a similar, if disapproving story. This is what burned me. I have no intention of going into the ones and zeros of land taxation here, but I would like to clear something up that was suggested in the Star's spin.

One of the critical features of a land tax is that all land is valued differently, and so for different parcels of land, people would pay varying amounts in land tax. Haslag states this and advocates it in his proposal. But the reporter at the Star either didn't bother to read enough of the report to understand, or felt the need to portray Haslag as some kind of radical wackjob, and deliberately got the facts wrong, asserting that all land in Kansas City would have the exact same tax liability, and it would vary only according to the amount of land their property occupies.

This is simply not true. But as they say, no press is bad press, when nobody is aware of what you're pushing. For the record, BlogKC picked it up too, and appears to disapprove as well, but is at least diplomatic and intelligent about it.

I think land tax is going to save the world, if the world is ever saved. So I'm happy that any mainstream media is talking about it.

5:28 PM, Jan 29, 2007

4 comments

Jeff blurted:

Why do you think the Star article is applying "spin" to the issue? I didn't really see it. They didn't mention anything about the _valuation_ of land, who sets it, or how it is set, which is important. But they didn't say it would all be the same. They used Haslag's estimated average to explain the amount of revenue the City could collect off it. Could he have been more clear? Yeah. But I thought the article was decent for being so short.

A columnist at the Post Dispatch wrote favorably about the issue (St Louis also has a 1% E-tax): href="http://www.stltoday.com/stltoday/business/columnists.nsf/davidnicklaus/story/758473FB5928388D8625726D000F614D?OpenDocument

One point of clarification--the E-tax is paid by residents living in KCMO and by employees working in KCMO regardless of where they work, so locals finding a job outside the city isn't always a time to rejoice (because then I'd be rejoicing, which is ironic since I'd rather work in the city).

Land Tax is an interesting idea, but it's still a tax. I'd like to see a table saying "This is how much in taxes you would pay at a few locations in the metro." There's a total tax out there and the E-tax (or a land tax, etc) may not make living in KCMO more expensive then other places. I don't know if the E-tax's bad rap is deserved.

I need to read more about land tax. There's a piece of the puzzle missing in my understanding.

7:45 AM, Jan 30, 2007

Ryan blurted:

The Star owns a lot of land, most of it put to no productive purpose, in a part of town where the value of land is highest (downtown, obviously). I think they have a very clear motive to poo-poo a land tax.

12:03 PM, Jan 30, 2007

Jeff interjected:

Here's your negative article from the Star: http://www.kansascity.com/mld/kansascity/business/16583713.htm

Basically everyone they interviewed hadn't seen the details, yet still called it bad. Good job, everyone!

8:06 AM, Jan 31, 2007

devil's advocate - dick spoiled the calm with:

what's your point?

people have been paying property taxes, including on land, which vary in value, for some time. besides, if you are advocating to paying a different labeled tax to aid your city, how would living in an apartment help? raised rent?

9:22 AM, Feb 1, 2007

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