Harberger Tax

The Harberger Tax, also known as Common Ownership Self-assessed Tax (COST), is a type of property tax that aims to improve societal welfare by optimising for both investment and allocative efficiency of private property. It proposes a new kind of "partial ownership", halfway between private ownership and common ownership.[1] The tax is implemented by two mechanisms:

  • Owners periodically self-assess their property and pay tax on its value.
  • Others are able to purchase the property from the owner at the taxed price at any time, forcing a sale.

First proposed by American economist Arnold Harberger,[2] it was further popularised in Glen Weyl and Eric Posner's book Radical Markets: Uprooting Capitalism and Democracy for a Just Society.[3]

A similar idea was previously proposed by Sun Yat-sen in 1905, where the government is the entity that can purchase the property from the landowners if the self-assessed price is too low. [4]

References

  1. ↑ Posner, Eric A.; Weyl, E. Glen (10 April 2017). "Property Is Only Another Name for Monopoly". Journal of Legal Analysis. 9 (1): 51–123. doi:10.1093/jla/lax001.
  2. ↑ Harberger, Arnold C.; Matus Romo, Carlos (1965). "Issues for tax reform for Latin America". Joint Tax Program of the Organization of American States, eds, Fiscal Policy for Economic Growth in Latin America: 116–121.
  3. ↑ "Radical Markets: Uprooting Capitalism and Democracy for a Just Society". Princeton Alumni Weekly. 2018-03-07. Retrieved 2022-10-16.
  4. ↑ Niou, Emerson M. S.; Tan, Guofu (1994). "An Analysis of Dr. Sun Yat-Sen's Self-Assessment Scheme for Land Taxation". Public Choice. 78 (1): 103–114. ISSN 0048-5829.
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