Land value tax (LVT),
Definition of Land value tax (LVT):
A levy (tax) only on unimproved (vacant) land as opposed to the current practice to impose taxes on real property which is the combined value of the land including any buildings and infrastructure constructed thereon. The value of the building and land is determined by the local property tax assessor using practices adopted by the jurisdiction where the property is located.
A land value tax is a more predictable way to tax property based solely on the value of a parcel of land and not any associated buildings. The concept of a land value tax dates back to the beginning of agrarian societies when deciding how to tax landowners fairly for the benefit of the larger community was a common social goal.
A land value tax (LVT) is intended to fairly value land, which is a finite asset with a base value that does not change as dramatically as the structures built upon the land. Fluctuations in land values are determined in great part by what happens with and around the land. For example, an acre of land in a rural setting may not contribute as much to the surrounding economy as the same sized plot in a downtown urban location, where the location might be next to a new food distribution center needing an additional loading dock.
How to use Land value tax (LVT) in a sentence?
- A land value tax (LTV) is a method of assessing property taxes that only considers the value of the land itself and related improvements, and not the structures built on the land.
- An LTV is considered to be a more fair method of land taxation for agricultural regions where the land is productive.
- Land value taxes are examples of ad valorem taxation and are favored by some economists since land value tends to be more stable than that of houses or other buildings.
Meaning of Land value tax (LVT) & Land value tax (LVT) Definition