Question

The main argument put forth by advocates of the single-tax movement was that: a. Taxing only income would make for a more equal society. b. Taxing only land would be very efficient because taxing land does not decrease its supply. c. Taxing only imports would help to protect local jobs and stimulate local entrepreneurs. d. Having only one tax would be much easier for people to understand and much less costly to administer than our current system with its wide variety of taxes.

Short answer

The main argument of the single-tax movement was taxing only land for efficiency, as per option b.

Step-by-step solution

Understand the Question

The exercise asks us to identify the main argument advocates of the single-tax movement put forward. We need to carefully evaluate each option and determine which one aligns with this objective.

Analyze Option a

Option a proposes that taxing only income would create a more equal society. This is not typically associated with the single-tax movement, which focuses on property, specifically land, rather than income.

Analyze Option b

Option b suggests taxing only land because it would be efficient as it wouldn't decrease the land supply. This is closely related to the single-tax movement, notably championed by Henry George, who argued for a single tax on land to promote equality and efficiency.

Analyze Option c

Option c claims that taxing imports would protect jobs and stimulate local entrepreneurship. The single-tax movement did not focus on import taxes, and instead centered on domestic economic and property reform.

Analyze Option d

Option d suggests that a single tax system would be simpler and cheaper to implement. While it mentions simplicity, it doesn't specifically highlight the land tax focus, which is the core of the single-tax movement.

Conclusion

Having analyzed all options, the main argument of the single-tax movement was to promote efficiency and economic fairness by taxing only land, as noted in option b. This efficiently targeted the unearned income of landowners without reducing land availability.

Key concepts

Land Tax

The concept of a "land tax" is central to the single-tax movement. Its appeal lies in its fairness and efficiency. A land tax specifically targets the land's value, not the structures on it. This means the taxed value remains stable and predictable, a land's intrinsic worth isn't influenced by constructions or improvements. This tax would not discourage land improvement or productivity because it is not based on land use changes. Land remains in fixed supply; therefore, taxing it doesn't reduce its availability.
Preferably, it captures the "unearned" increment, meaning the extra value arising from community developments, not individual investments.
A land tax can promote efficient land use, prompting landowners to optimize their property and contribute economically, thereby stimulating economic growth.

Economic Efficiency

"Economic efficiency" plays a vital role in the argument for taxing only land. An efficient tax system minimizes economic distortions and encourages optimal resource allocation. Since land, unlike labor or capital, remains constant in quantity, taxing it doesn't discourage its availability. Thus, it aligns perfectly with the principles of economic efficiency.
In other words, a land tax doesn't penalize advancement or deter investment, allowing the economy to operate without unnecessary burdens.
This approach advocates for a fairer distribution of tax responsibilities, since everyone benefits from public services funded by taxes. Overall, the economic efficiency of a land tax ensures productive land use and equitable economic growth.

Property Taxation

The intricacies of "property taxation", involving land tax, bring focus to a significant detail often overshadowed. Taxation on property typically covers both land and the improvements made upon it. The single-tax movement, however, delineates land tax from this broader category by emphasizing only the land aspect.

• By separating land from structures in tax assessment, it encourages investments in development and improvement without increased tax burdens.
• It also discourages land speculation, as owners can't afford to leave valuable land idle for long periods without productive use.

Therefore, this approach to property taxation aims to take only land's "unearned" value, promoting efficient land use and economic equality without penalizing development.

Henry George

"Henry George" stands as the leading figure behind the single-tax movement. His influential book, "Progress and Poverty", published in 1879, argued passionately for the land tax. George contended that economic problems like poverty and inequality primarily arose from private land monopolies.
By advocating for a single land tax, he sought to redistribute unearned wealth that landowners gained due to societal enhancements.
His philosophy suggested that taxing only land would eliminate other debilitating taxes, fostering economic prosperity.

• George promoted a vision where public revenues derived solely from land taxes could fund communal infrastructure and services.
• This approach aimed to increase resource allocation efficiency and ensure justice in wealth distribution among community members.

His ideas continue to inspire discussions on land policy and economic reform.