West Virginia Efforts Toward Land Value Taxation

Carl Shaw

[A memorandum distributed to West Virginia legislators, 20 January, 2007.
Reprinted from GroundSwell, March-April 2007]

(Additionally, Carl Shaw and Art Rybeck (see Write On reprint on page 4 of this issue of GroundSwell) are elected senators to the West Virginia Silver Haired Legislature, where Rybeck chairs and Shaw co-chairs the Finance Committee. West Virginia seniors at the 55 WV county senior centers elect 100 House of Delegates members and 34 Senators for 2 year terms. The positions are non-partisan, volunteer and honorary. Those elected meet several days per year and enact proposals which are forwarded on to the regular legislature for their consideration.)


TO the January 2007 West Virginia Legislature

FROM Carl Shaw, Mt. Zion, WV, Jan. 20, 2007

1. The Creator probably made the WV land and resources for all of us to own and use equally. Total WV land area = 15,516,160 acres, divided by the population of 1,808,344 = 8.5 acres per person.

2. We all contribute by our presence and economic efforts toward creating the annual site rent of land. Labor and capital construct a) private improvements, homes, industrial plants, commercial business, and; b) public improvements including streets, government administrative, hospitals, schools, airports, police and fire. No land owner generates site rent all by him/her self. Rent is a social product and in justice must be shared by all society.

3. Any tax on land is a tax on the annual rent of land (presently calculated on the market value, but which only exists because most of the rent was not taxed).

4. West Virginia is about the 48th state in per capita income.

5. WV is nearly the eldest average population of all states, because many young people migrate elsewhere for better job opportunities.

6. WV unemployment and low job participation is currently at about 5% of the workforce. No unemployment should be acceptable.

7. WV land is taxed, but at one of the lowest rates in the nation. Only about 10% of the site rent is taxed (shared) -- all the rest goes to private persons.

8. Land can be considered as speculated if not in use. Unused land employs no one.

9. Taxing land creates an incentive to use. Labor and capital are not harmed by land taxation. Land taxation implements justice by sharing the site rent. Land taxation is economically beneficial.

10. Higher land taxation encourages its owner to find a better way to use land, so as to bring in enough additional income to pay any increased land tax.

11. Taxing labor and capital is a punishment for having produced wealth. Labor and capital won't work harder just because their sales, incomes, and profits are taxed.

12. WV taxes on labor and capital are near the middle of the U.S. states; however, taxes on equipment is among the highest in our nation.

13. Our state constitution tax law was written in 1932 to encourage land speculation. Article 10 can and must be changed in order to encourage economic activity and justice, via higher land taxation. This will require a vote of the people. The Legislature can begin the process.

14. Other states and nations which tax land higher do well economically.

15. There are two methods of land tax reform. The Pennsylvania two rate property tax, wherein the improvement part is reduced while the land part is increased usually results in reduced tax bills for most residential properties in residential neighborhoods. Harrisburg, Allentown and Washington are good examples. The other technique (psychological) could relieve taxpayer stress by billing property taxes monthly. State income taxes are levied with each paycheck or quarterly while sales taxes are levied on each sale.

16. New Hampshire was near the bottom of the states economically in 1930. Tax reform there involved higher land taxes, without income or sales taxes. Today NH is near the top of states in per capita income, and in population increase, while last in unemployment. Land taxation works!

17. Please don't ignore this all important issue. The practice of maintaining unused and underused, valuable city land cannot continue to be policy. We are losing young people to other states, and by taxing labor and capital instead of land values we penalize our economy while rewarding land hoarders. Land taxation cannot harm genuine farmers. Those who scream about hurting farmers are actually speculators who use farmers as an excuse to hang on to unused, valuable city land.