Common Wealth Canada
@commonwealthcanada
Would you vote for a policy that makes homes more affordable, but noone could profit much from rising home prices? This is the trade-off we need to ask for future generations.
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We could virtually eliminate income tax for Canadians if we better taxed land and resource rents instead. Instead, working families are getting the snot taxed out of them while rents rise.
"If we want real affordability we need to stop pretending that supply alone can fix this crisis. No matter how much we build investor demand is growing even faster."
Economists on the left and right agree that the fairest tax of all is NOT on what you earn from work or building homes, but on what you don't earn from rising land value.
Noone's talking about what we actually need, which is for prices to come down. The desire to get wealthy off land values is incompatible with the need for affordable homes. Again, no politicians are even acknowledging this.
At the root of our housing crisis is the collective desire to treat homes as an investment, not just a place to live. How do we turn that around?
If we want affordable homes, we must break our addiction to high and rising home prices, which come mostly from land values.
Texas has high property tax but no state income tax. As Canadians grapple over new property tax hikes, it's a good chance to understand this trade-off. Property tax is least damaging and LVT is even better. It could replace more harmful taxes on income.
By taxing land instead of buildings, owners in both scenarios pay the same amount. This encourages more efficient land use and discourages holding just for appreciation—making our housing system work better.
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