Prosper Australia land tax questions
Prosper Australia have a page called Policy, which states the following:
“Prosper Australia advocates the elimination of all taxes and their replacement with a Land Value Tax.”
Let’s reflect on the above proposal.
One carrot dangling in front of us as workers is the prospect of paying off our mortgage one day. One day in the future we will finally be able to work less and spend more time with out family and friends and generally doing those things we really enjoy doing.
There is a motivation to be in the rat race because we know the harder we work, the more education we have, the more pay we receive, the quicker we get to the point of being able to buy and then pay off our homes. If we pay off our home completely we are in a more powerful position because we have greater freedom to choose whether we go to work 5 days a week or 2, whether we fill our days with activities or just reading books etc.
The proposal above takes away that carrot.
The prospect of one day paying off your house and then being free to slow down and do more of what you want, even if that’s just because you have hit retirement age, is removed if you introduce a land tax to replace all other taxes.
The carrot is replaced with a stick.
Imagine if there was nothing you could do to ever get off the rat race?
Imagine finally paying off your home, and then having to pay land tax on your house for the rest of your life.
Prosper Australia states:
“If you work for a living you will be better off”
The above remains to be seen, as any reduction in direct tax you pay will be paid by someone else.
If the tax is paid by a company they will pass the cost back to you as the consumer.
One thing is for certain regarding a Land Value Tax.
The dream of home ownership will no longer lead you away from the rat race.
Note: The land tax argument has also been argued on The Conversation in the article, ‘BCA wants your home taxed – and it’s actually a good idea’. The article allowed me to argue against land tax which I did in the comments.