Land can not be bid; its rent at any time is readily ascertainable, so that the Government would get a considerably larger percentage of taxation than now.
Mr. George tests his proposition by the accepted canons of taxation, and finds that the tax on land is the only tax which can not be distributed—which those taxed can not throw off on to others. It is, therefore, the only tax which does not bear upon production. This also follows from the law of rent, as the relation between the most productive and least productive land in use is not altered by such a tax, and therefore the share of labor and capital can not be affected by it. Under such tenure of land the burden of taxation will be raised from production, and, while it still pays rent, though a greatly reduced one, this goes to the state, to be used for the benefit of those who have created the fund.
Under such an arrangement, land would be improved as fast as there was a demand for it. No one, as now, could afford to hold land unless he proposed to use it. There would be no prospect of parting with it at a future time for more than now, while the holder would have to pay an increasing rent without any advantage accruing to him. This tax, therefore, would have the effect of forcing improvement instead of acting, as present taxation does, as a fine upon improvement. Nor need any fears be entertained that such a holding of land would deter men from improving it because they did not own it. Ownership is not necessary, as is shown by the many costly buildings in every city built upon leased land. All that is necessary is that there be security for the improvement.
Mr. George holds that, though the proposal to place all taxes on land is, at first sight, to increase the burdens of the farmer, it is not in reality so. At present he is taxed on all his improvements, houses, barns, fences, stock, and crops, while, through the action of the tariff, he pays enormous taxes on everything he consumes. Under the arrangement proposed all these taxes would be removed, and there would remain only the tax on the bare land. As speculative land-values would be abolished, and large tracts of land now held thrown open to improvement, the value of his land would decrease, with the result that, in sparsely settled districts, he would have little or no taxes to pay. The tendency of this measure would be to distribute population more equitably—to take from the overcrowded city and add to the thinly settled country. With the continued application of machinery to agriculture, farming life would tend to assume the form of the village community, whence the great gain to the farmer in the increased advantage of social intercourse. He would lose little or nothing in a pecuniary way, and gain much in an improved social life. And so with the owners of homesteads, and all land-owners whose interests as such do not greatly predominate over their interests as laborers and capitalists.
