"The land tax as the only means of supporting the government is an infinitely just, reasonable, and equitably-distributed tax, and on it we will found our new system. . . . The land tax as the only means of supporting the government is an infinitely just, reasonable, and equitably-distributed tax, and on it we will found our new system."
– Dr Sun Yat-Sen

TAXING LAND VALUES IN AUSTRALIA
by Dr Terry Dwyer
Overview

Many Australians would still agree with Dr Sun Yat-Sen’s observations. The history of Australian land value taxation and rating of land values for municipal and public utility financing is valuable for at least three reasons.
It shows that site or bare land values can be assessed and taxed, contrary to assertions sometimes made by economic writers unfamiliar with the subject.
It shows that land values as tax base can be shared, with any need for explicit co-ordination, between Federal, States, local government and semi-government public utilities.
It shows that public utilities can be financed without 100 per cent resort to naïve “user pays” charging per kl of water or per kl of electricity and that deadweight losses due to usage charges being well in excess of short run marginal cost (SRMC) can be avoided.
Finally, the Australian experience shows that good systems of revenue raising for public works or public utilities can be corrupted or abandoned due to ignorance of officials and politicians when faced with demands for “reforms” promoted by vested landholder interests seeking to shift revenue burdens off land onto workers or producers.
The history of Australian use of land value taxation or land value rating to finance public works has several sources. >>>more

“The land tax as the only means of supporting the government is an infinitely just, reasonable, and equitably-distributed tax, and on it we will found our new system."
– Dr Sun Yat-sen (1866-1925), Father of the Republic of China.

Ostensibly, the Chinese economy is increasingly reliant on construction, which has stoked a huge credit boom. It is often said that China avoided a direct hit from the financial crisis of 2008, unlike the United States and Europe; essentially, Beijing built its way out of a recession.

Certainly, the effects of this policy have filtered into China’s real estate sector. As academic Christopher Balding notes, a housing price index for 100 Chinese cities, published by Fang Holdings, rose 31 per cent to nearly US$202 per square foot from June 2015 to December 2017. “That's 38 per cent higher than the median price per square foot in the US, where per-capita income is more than 700 per cent higher than in China,” he said.
Why China is not the new Lehman Brothers
While this is worrying, we contest the view that there is no real remedy to China’s current predicament. Actually, China is in a better situation than some countries in the West because it has the main ingredients needed to help mitigate the threat of a bursting housing bubble.
Beijing need not look far for inspiration. It could refer to the writings of Sun Yat-sen, the revolutionary leader who is still fondly remembered on the mainland. A man of letters and a philosopher on a range of topics, Sun took a particular interest in land tenure, probably after discovering American political economist Henry George as a young man in Hawaii. George argued for a single tax on land value, a principle now known as “Georgism”. >>>more

"Sun Yat-Sen repeatedly acknowledged the influence of Henry George and this influence went beyond details of land policy. Significant parts of George's work involved his extensive references to China, his diagnosis of China's ills, his vision of a probably better economic order, and his strong attack on the Malthusian theory, These too influenced Sun."
- Henry George, Sun Yat-Sen and China: More than Land Policy Was Involved, by Paul B. Trescott, Professor of Economics, Southern Illinois University at Carbondale, IL 1994, JSTOR

Not Out of the Blue: Sun Yat-sen and the ROC-PRC Paradox (pdf)
By Jacob Throwe
2011
Boston College University, Department of History
Advanced Independent Research Project Thesis
107 pages
Contents
Note on Romanization
Preface: An Apparent Paradox
I. Father of the Nation
1. Sun Yat-sen: The Man Who Would Be Guo Fu
2. The Fragile Bond of the First United Front
II. Battling Successors
3. Chiang Kai-Shek and The Fight over Interpretation
4. The Alternative of Mao Zedong
III. The Question of Democracy in Greater China
5. The Wavering Bond between Taiwan and China
6. The Political Transformation on Taiwan
Conclusion

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Sun Yat Sen's Three Principles (pdf),
By Stan Rubenstein
[Reprinted from the Henry George News, June, 1970]

WHETHER revolutions make men or men make revolutions is as debatable today as it was when Thomas Carlyle stated the case during the period of the French Revolution. But one cannot deny that a revolution usually has some individual closely associated with it. We tend to connect Washington with the American Revolution, Lenin with the Russian Revolution and Castro with the Cuban Revolution.

Sun Yat Sen seems to belong to the Chinese Revolution of 1911, for after more than two thousand years of dynastic rule, China, amid the turmoil and chaos of the Manchu dynasty, established its first Republic. And with the emergence of this revolutionary government one man stood out as the leader - Sun Yat Sen.

Prior to 1911 Sun Yat Sen traveled widely, spending some time in Japan and the United States. Influenced by western concepts of industrialization, he carried back to his native land ideas that differed from those normally prevalent in Chinese culture. These ideas affected ensuing events in a significant way.

Of particular importance was his book San Min Chui, or Three Principles of the People. This work is still popular among the Chinese and it cuts across political lines. The proposed reform was embodied in what he called the peoples' principle, and the plans were to be altered or revised as the revolution took various turns.

His concepts of nationalism and democracy appealed to the dignity and loyalty of the Chinese and strengthened them in their resolve to rid themselves of all foreign powers and gain the respect of the international community. Democracy was envisioned to rest with the wishes of the people as interpreted through their leadership.

The principle of livelihood, his third important contribution, was Sun's hope of achieving a desirable living standard for the Chinese based on an equalization of land ownership and regulation of capital. When he was asked what the policy of China was he responded, "We propose that the government shall levy a tax proportionate to the price of the land, and if necessary buy back the land according to its price."

According to this formula the landowners could set the value, and if the value was excessive the landowner would have to pay high taxes. If the value set was too low the government would buy the property. From this point forward all increases in land value would go to the community and increases in value would help defray the costs of government.

Since Sun's ideas were influenced partially by Henry George and partially by Karl Marx, he advocated that the state should regulate capital and serve as a source of promoting industry. He disagreed with Marx's analysis of class struggle however, and attempted to reconcile parts of both systems.

Sun's program was not carried out during his lifetime but it is ironical that the Chinese Communists have been influenced by some of the thoughts concerning the state regulation of capital, and the Nationalist Chinese have incorporated some of his basic views on the equalization of land ownership.

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Single Tax Attracts Orient
Dr. Sen's Advocacy Due to Missionaries, Says Henry George, Jr.
Special to the New York Times, April 6, 1912:

Representative Henry George, Jr., has been in correspondence with
reformers in China, and the news that Dr. Sun Yat-Sen had begun an active campaign to institute the single tax in China was no surprise to him.

When Mr. George, who maintains a correspondence with single tax leaders in all parts of the world, was asked what he knew about Dr. Dun's declaration, he replied:

"I have known, by private correspondence for some time, that Dr. Sun had not only read 'Progress and Poverty,' my father's book, but was an ardent believer in its teachings.

"Fortunately for the pressure upon his time, Dr. Sun found a translation of the book that suited him well. It was made by Dr. Macklin, an American missionary, who for years has been carrying the Bible in one hand and 'Progress and Poverty' in the other, preaching the Gospel from the one and equal rights for all of God's children to God's earth out of the other.

"Dr. Sun seized upon this Macklin translation and stimulated its circulation among the thinkers of the Chinese revolution.

"It is a curious fact that in this movement toward the single tax China is following the lead of Japan. Dr. Garst was as enthusiastic over 'Progress and Poverty' as Macklin, and talked to the young Japanese in and out of the missionary movement.

"One of the men who was directly, or indirectly at least, reached by Garst was Baron Saketani, who, through the Japanese-Russian war and until quite recently was Minister of Finance. Baron Saketani openly advocated the taxation of land values in preference to any other kind of tax for revenue purposes, and introduced a bill in the Japanese Diet with this end in view. The big landlords, together with the big army and the big navy advocates, were too strong for him, however; and before he could initiate this movement he was compelled to give up his portfolio in the Cabinet.

"From the movement initiated in Japan and China larger things will grow in the future. Japan can raise enough revenue from her land alone to meet all the expenses of Government without taxing any improvements, personal property, incomes, or inheritances, and without any tariff exercise or other sort of taxation.

"It will be seen, therefore, that the American missionaries carried a great economic idea into the Far East, and while they taught the Gospel they also taught the Oriental peoples how better to get a living.

"It will be a very remarkable thing in the history of the world if the United States of America shall be so slow in her economic progress that China and Japan shall show her the way to economic freedom.

"Dr. Sun has shown an extraordinary understanding of the Chinese revolution in addressing himself to the establishment not only of a people's government, based upon the people's rule, but by going deeper and addressing himself to the business of every Chinaman relative to the question of earning his daily bread. By attempting to life the load of taxation from the backs of the hundreds of millions of Chinese laborers and concentrating the whole tax burden on the back of landlordism, he is, at one stroke, liberating production and burdening landlordism. He encourages production and discourages land concentration."

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The Unplumbed Revenue Potential of Land
by Mason Gaffney
Professor of Economics, University of Caifornia, Riverside
October 2012
Excerpt

Conclusion
Rent as Revenue: Quantity and Quality
I hope that this brief survey has demonstrated land's suitability as a tax base in terms of quantity. It is eminently suitable in terms of quality as well. The macro-economic benefits are deep, wide, high, and temporal. To produce the added goods the owner invests more capital and hires more labor, or sells parcels to laborers wanting to go into business on their own. The newly employed labor earns incomes to buy the newly produced goods and services. Here is supply-side economics coupled with demand-side economics. The conventional left-wing objections to Say's Law do not apply here, because we are untaxing capital at the same time, and raising investment opportunities. We are financing government to provide needed infrastructure to develop new lands, or redevelop brownfield lands, to open new investment opportunities for private capital. The conventional right-wing objection that capital is limited does not apply, either, because we are stimulating saving, stimulating import of capital, and raising turnover of capital. (Turnover raises the ratio of income-creating investing to capital.) It is the macro-economists dream, leveling upwards while balancing supply and demand, saving and investing.
Read the entire article here

The Hidden Taxable Capacity of Land: Enough and to Spare (pdf)
By Professor Mason Gaffney
July, 2008
Published by Int'l Journal of Social Economics, Vol. 36, No. 4, 2009, pp. 328-411,

Abstract
Purpose – A tax based on land value is in many ways ideal, but many economists dismiss it by assuming it could not raise enough revenue. Standard sources of data omit much of the potential tax base, and undervalue what they do measure. The purpose of this paper is to present more comprehensive and accurate measures of land rents and values, and several modes of raising revenues from them besides the conventional property tax. Design/methodology/approach – The paper identifies 16 elements of land's taxable capacity that received authorities either trivialize or omit. These 16 elements come in four groups. Findings – In Group A, Elements 1-4 correct for the downward bias in standard sources. In Group B, Elements 5-10 broaden the concepts of land and rent beyond the conventional narrow perception, while Elements 11-12 estimate rents to be gained by abating other kinds of taxes. In Group C, Elements 13-14 explain how using the land tax, since it has no excess burden, uncaps feasible tax rates. In Group D, Elements 15-16 define some moot possibilities that may warrant further exploration. Originality/value – This paper shows how previous estimates of rent and land values have been narrowly limited to a fraction of the whole, thus giving a false impression that the tax capacity is low. The paper adds 14 elements to the traditional narrow “single tax” base, plus two moot elements advanced for future consideration. Any one of these 16 elements indicates a much higher land tax base than economists commonly recognize today. Taken together they are overwhelming, and cast an entirely new light on this subject.

Introduction
Scores of economists tell us that an ideal tax is one based on the value of land. A big part of the benefit is getting rid of other taxes, taxes that impose “excess burdens” by twisting incentives against the bases taxed. Then these economists abandon the point by assuming land values are too low to support modern government, so forget the ideal tax base.

Here we examine their reasons for so assuming. It turns out that the revenue potential of land is greater than almost anyone thinks. There is enough and to spare. We find that conventional sources of data are seriously negligent and consistently biased downwards. They omit much of the potential base and low-ball what they do measure. Then we go on to identify and uncloset hidden elements of revenue potential, by using truer and more comprehensive definitions and measures of rent and land values, and several modes of raising public revenues from them.

Some other economists and pundits, at the same time, express the opposite concern. They bridle at any land tax hike, even in a tax-cum-rebate proposal. It is just “feeding the beast”, they say, fearing that this feast is too rich. Some even take both positions alternately, as E.R.A. Seligman did a century ago when he bent the twig of modern tax theory1 . But here we just address the more common concern whether land revenues have the capacity to replace other taxes, so we may sunset the latter. We are looking at a “revenue-neutral” shift, to banish counterproductive taxes on labor, production, dwellings, other capital, and commerce. In the process we will specify ways to cut wasteful public spending by using private land better.

Beyond that we may or may not, as separate issues, want to add some “lean” to the public sector to provide and maintain its crumbling infrastructure, a foundation of the private sector. We may have to pay down our heavy public debts. Interest on those debts now consumes a high fraction of public spending, and threatens to take more as our international credit rating falls, as the dollar already has. We may want to raise taxes to bail out underfunded existing obligations like Social Security, public health, medical care, and public schools (or vouchers, as one prefers). We may or may not want to distribute a social dividend in cash, on the Alaska model2 . But again, each of those is a separate issue not treated here.

Many modern champions of Georgist ideas have withdrawn into a corner, confining themselves to modifying the existing local property tax by exempting buildings. Many (not all) even shy away from demanding reform of moss-covered assessment rolls3 . They express concern at being branded as “cranks” if they would do more, and of course their opponents see this weakness and use it to cow them4 . This timidity narrows the prospective tax base to a small and shrinking part of the total system of public revenues. I ask my readers to join me in exploring the whole system. It is not just the property tax, narrowly conceived, that brims with Georgist issues.

There are at least sixteen elements of land’s taxable capacity that previous researchers have either trivialized, or overlooked and “disappeared” entirely. In Group A, Elements 1-4 correct for the downward bias in standard data. In Group B, Elements 5-12 broaden the concepts of land and its rent far beyond the conventional narrow perception. This includes showing how the benefits of untaxing useful activity are shifted into higher taxable land rents, a very powerful effect. In Group C, Elements 13-14 show how removing “excess burdens” uncaps viable tax rates. In Group D, Elements 15 and 16 explore a moot idea on how mortgage interest might be treated as rent; and on how taxing the rents of absentee owners improves a local balance of payments.

The following Table of Contents shows how the four Groups and the Sixteen Elements fit together, and reinforce each other. I urge the serious reader to refer back to this Table often, as the focus shifts from one Element to another of the total thesis. The Elements are the trees; this is the forest.
>>>more

Land Value Taxation: Incentive Taxation, Site Value Taxation,
Two-rate/split-rate Real Property Tax (pdf)
Proceedings of the January 12, 1993 Conference
Government Law Center, Albany School of Law, Albany, New York, 12208

Professor Mason Gaffney, University of California at Riverside was the final speaker, on "The Taxable Capacity of Land" [pp. 60-73]

Closing paragraphs:
The city that fails to renew itself on time is destined for this fate like Camden, the Bronx, East St. Louis, Benton Harbor, MI, and Detroit.
That's the bad news. How do you turn it around? When you exempt buildings from the property tax base, you change the arithmatic of incentives, as we have discussed. Parachuting into the middle of a slum is still hopeless, as before. Change will come first in fringes of the Type II slum, where it merges into healthy neighbourhoods. New development likes to anchor itself onto existing healthy neighborhoods. Richard Hud, father of urban studies in America, taught us in 1902 that land values are marked by continuity of space, and it's still so. There is hope at the edge of the slum; land there retains some renewal value. That is where you'll first see change, because that is where the forces are evenly balanced. Tip the forces for renewal, and that is where it will happen first.

Once it begins, it proceeds incrementally through the Type II slum. When it's through, your oldest neighborhood has become your newest, the cutting edge of progress, the showplace of the town. That is how it has got to work; that is how it will work when you exempt buildings and tax only land. When it is through, you have a high tax base, too, where previously you had nothing byt cash drains. . .

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The Ultimate Tax Reform: Public Revenue from Land Rent.
By Fred E. Foldvary
SSRN, January 2006
Abstract
An ideal public revenue policy respects a person's right to privacy, does not discourage work or savings, and does not induce dishonesty. While income, sales, and value-added taxes fall woefully short of this ideal, land value taxation meets each requirement.

Excerpt: The German colony of Kiaochow, China, established in 1898, had a single tax on land value set at 6 percent. [35] Its principal city, Tsing-tao, developed into a fine modern city. The Germans lost the colony in 1914 at the outbreak of World War I, but their experience influenced the Chinese revolutionary Sun Yat-Sen, who became head of the government of China. He and his successors in the Nationalist Party were not able to implement land value taxation in that country, but when they moved to Taiwan in 1950 after the communists took the mainland, Chiang-Kai Shek implemented a land-to-the-tiller reform accompanied by a tax on land value. Taiwan has since developed into a major industrial power. Hong Kong and Singapore became major commercial centers in large part because much of their public finance is based on taxing land values, or in the case of Hong Kong, from selling land leases, with low taxes on trade and commerce...
Read the complete document.

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