I don&#x27;t get land value tax. The idea is theoretically supposed to be that you only pay tax on the value of the land, but the value of the land is because of what&#x27;s on&#x2F;around it. There is plenty of perfectly good land in rural Texas or Iowa but it isn&#x27;t as valuable as land in San Francisco because there isn&#x27;t a city right there.<p>So you have somebody who is going to build a factory and they pick a nice piece of low value rural land. But once there is a factory, people build housing for the workers and stores and so on, and now you have a whole town centered on the factory and the value of the land goes up. But the reason the value of the land goes up is <i>because of the factory</i>.<p>So the next thing you know the factory owners realize they&#x27;re sitting on a &quot;high value&quot; piece of land, so they put all the machinery on trucks and carry it fifty miles down the road where the land is still cheap and they don&#x27;t have to pay high taxes. And then the process repeats.<p>It seems like the result would be a <i>preposterous</i> amount of urban sprawl and inefficiency. Anything that doesn&#x27;t actually care about its location but attracts other investment would keep getting moved, which would destroy the value of the third party investment.<p>Third parties would then respond by making their investments mobile (e.g. living in mobile homes or selling food from food trucks instead of building houses or restaurants). Every time the taxing authority said the piece of land where everybody is has significantly more value than the piece where nobody is, everything moves down the road again.<p>And that&#x27;s the extreme case but you get the same thing in the suburbs. You don&#x27;t want a house which is near anything because the land value will be higher which is now a liability, so build it a little further out and you&#x27;ll have a longer commute but your taxes will go down by $10,000&#x2F;year.<p>Because it isn&#x27;t the land that has value, it&#x27;s the people and the stuff. If you tax land highly non-uniformly then the people and stuff will spread out.