enough.berlin

If You Want to Tax the Rich, Tax the Land

2026-07-10T00:00:00+00:00

So you want to tax the rich. Good instinct, but you're at a disadvantage. The rich have many options for reducing their tax bill, you can find articles online like this one outlining 10 different ways</a>; for example taking out a loan against shares so now you have debt instead of income, and you didn't sell the shares so you don't have realised capital gains.

They can also try to just leave if you tax them, though how much they actually do is hotly contested. Norway's wealth-tax hike was followed by some high-profile departures, but its wealth-tax revenue rose afterwards</a>, because the base is broad. The UK's "non-dom" reforms set off a wave of "millionaire exodus" headlines, but the figure everyone quoted came from a firm that sells golden passports</a>, and its method</a> (counting where millionaires say they work on LinkedIn) doesn't track where they actually live. The honest summary: income, capital and wealth taxes are partly avoidable, and the evidence on how much is murky and politically charged.

And that murkiness is exactly the case for Land Value Tax. You're up against the most well resourced people on the planet, with financial institutions/lawyers/accountants to help them, who can lobby for laws that help them, and can move to the most beneficial place for them. So stop fighting over whether they'll flee, and tax the one thing that can't flee: land. It might be the only tax you can't avoid:

it's land, so you can't move it to another tax jurisdiction</li>
you can take out a loan against it, or pull the other financial tricks, but none of them help: the land tax isn't triggered by a sale or any "realised" event. It's an annual charge on the asset itself, so there's nothing to defer or hide behind.</li>
you can move ownership to a shell company in a tax haven, but that just means the shell company has to pick up the tab.</li>
you can sell the land: good! That puts it in the hands of someone who'll actually use it instead of sitting on it. You can't make more land, so we want what already exists to get used.</li> </ul>
And another thing about land is that it is also collateral. Fail to pay the tax bill? Guess you lost your land then. The state doesn't even have to go looking for it: every plot is already in a land registry, title and all. In some countries that registry is even public. Here's Sweden's Lantmäteriet</a>, where Swedes can just log in and see who owns what.
Since the above is very international, let's focus in on Germany and Berlin.
The primary tax sources for Germany</a> are VAT and income taxes. VAT is regressive</a>, as it's a flat tax regardless of your ability to pay. And while income taxes are progressive, that breaks down at the top. Not because the rich are cheating, but because most of their money isn't "income" in the taxed sense: it's investment returns, dividends and capital gains, which Germany taxes at a flat 25%, not the progressive rate that tops out above 45%. germanwatch.org finds</a> the effective rate is 43% for middle-class families and 26% for billionaires, and Netzwerk Steuergerechtigkeit find a similar gap</a> comparing a typical millionaire with an average working family. The system under-taxes wealth held as assets, and land is exactly that kind of asset.
Now, two honest objections, before you conclude I've found the perfect tax. First: "the landlords will just put it on the rent." In Germany they legally can; Grundsteuer gets passed to tenants through the Betriebskosten, and a land value tax would presumably show up on the same bill. But the line on the bill isn't the same as who bears the cost. Landlords already charge what the market bears; a higher tax doesn't let them charge more, and they can't respond by supplying less land, because nobody makes land. The standard result is that a tax on land value stays with the landowner and shows up as a lower land price instead. This deserves its own post, because if you advocate LVT in Germany you will hear this objection within the first five minutes.
Second: nobody dodges a land tax, and "nobody" includes the retired couple who own their flat, not just the housing giants. True. LVT isn't aimed at the rich; it's aimed at land, and it hits everyone who owns some. Its progressivity isn't designed in, it falls out of who owns the land. In a city of homeowners it would look nothing like a tax on the rich. So two questions decide everything: who owns the land here, and is that really where the wealth is?
Let's look. berlinnewsdaily have a post on "Who owns Berlin Rentals"</a>, which they had to piece together from sources like the "Who owns the city?" analysis</a>, because Germany's land registry, the Grundbuch, isn't public. The result: about 6% is "individuals with 1 apartment" and the rest is companies/individuals with significantly more. This 2021 article from the Financial Times says that 85% of Berliners rent</a>, so a small number of entities own a large amount of Berlin's land, and rent it to everyone else. Berlin is not a city of homeowners.
And that land is exactly where the wealth is piling up. Another of their posts</a>, based on Deutsche Bundesbank's Distributional Wealth Accounts (DWA)</a>, finds that over the last 10 years wealth in Germany roughly doubled, and 57% of that wealth is in "Real Estate (Housing)", but I guess I'd have phrased that "Real Estate (Land+Housing)". So an unavoidable tax on land isn't just unavoidable here: it lands squarely on the wealthy.
And that's only the housing. Berlin's land also sits under office towers, shopping streets, hotels and industrial estates, and nobody's Oma owns an office block on Unter den Linden. Whatever share of the city's land value is commercial is corporate wealth by definition.
Berliners have noticed who owns their city, of course. In 2021, 59% voted to socialise the holdings of the biggest landlords: the "Deutsche Wohnen & Co enteignen" referendum. Almost five years later, not a single flat has changed hands. Not because it's unconstitutional; an expert commission concluded in 2023</a> that it's legally possible. But it means invoking a never-used article of the Grundgesetz, paying compensation that could run into the tens of billions (how many is itself fought over; the commission thought even below-market compensation permissible), and years of litigation before the first apartment moves. And so far, the Senat has simply refused to write the law.
But here's the thing: you don't need to take the buildings. You can tax the land rent from under them. That's not expropriation, it's just tax law, and Germany has already stress-tested it. Baden-Württemberg's new Grundsteuer taxes only the land value, ignoring the buildings entirely, and in May 2026 the Bundesfinanzhof confirmed it's constitutional</a> (readable summary at LTO</a>).

Taking the apartments: legally heroic, politically stuck, billions in compensation.</li>
Taxing the land under them: already happening in one of Germany's largest states, blessed by its highest tax court, and nobody gets compensated for losing the right to collect rent on something they never created. And Berlin could simply do the same: it currently uses the federal model, which taxes the buildings too, but the opening clause that let Baden-Württemberg go its own way is open to every Land. The legal road has already been paved.</li> </ul>
Conclusion</h1>
So we've got a small number of very wealthy entities, holding a lot of valuable land, paying relatively little tax, and renting that land to the 85% who don't own any. Berlin already voted to take the buildings back, and got stuck. But the land is still sitting under those buildings, and it's the one asset the wealthy can neither move offshore nor hide behind a loan. Taxing it is the one route Germany's courts have already waved through. So if you want to tax the rich, tax the land.

Three stops and a lot of waiting

2026-05-20T00:00:00+00:00

A local politician and architect, Tarek Massalme, recently posted on Instagram that Berlin needs to de facto build a new district</a> — over 200,000 apartments for a city heading toward 4 million people. He's right, we need all the housing we can get.
I wanted to see what's actually happening with the land we already have, see what plots this de facto district could be spread over. So I took the S-Bahn from Ostbahnhof through Jannowitzbrücke to Alexanderplatz, three well-connected stops in the dead centre of Berlin, and just looked out the north-side windows.
What I found was surprising. It's not that nobody has plans. Almost every empty plot I spotted has a project attached to it. The problem is pace.

What I Saw</h2>
Ostbahnhof — Right out of the station, a 4,800 sqm empty plot</a> at the corner of Lange Straße and Straße der Pariser Kommune. According to BORIS</a>, that's €8,000/sqm, over €38 million worth of land. There is a plan: a 12-storey office building called BOBH</a> by Eike Becker Architects. The building application was submitted in July 2022. Trees were cleared in early 2024. The döner shop was demolished in March 2025. As of my ride: still a parking lot. And don't worry about the Doner shop, it took over the location of Style Bar nearby... and while the Doner shop is nice I really miss Style Bar, that place was great!

Signs of progress — The LXK Campus</a> is going up nearby: 54,700 sqm of mixed use plus around 150 apartments, due to complete at the end of 2026. So development does happen.

The pool — A site we've talked about before</a>. Last time I looked, they'd cleared the vegetation around it. It seems to be growing back.

90mil — Across from the pool sits 90mil</a>, a temporary DIY arts space at Holzmarktstraße 19–23, vague memories that it used be a van rental or something, can't find what it was before. Now there's an art school, ceramics, theatre, club nights. Their Instagram bio: "Multidisciplinary space. In the making, to be destroyed." Scheduled for demolition in 2026. I love places like this. There even used to be a pop-up sauna at the same spot, which was genuinely wonderful, and felt real old school Berlin! I feel bad calling this place "underdeveloped", and random fun stuff moving into disused places is one of the things I loved most when I first got to Berlin. Maybe if we did a better job developing the genuinely underdeveloped stuff like the carpark above, in a timely manner, we wouldn't be in such a crisis that we have to come for places like this that make Berlin unique (see also: Raw Galende</a>, Templehof</a>...)

JaHo — The future site of JaHo Berlin</a>, a major development with a 75m David Chipperfield-designed tower. Around 50,000 sqm on a 7,400 sqm plot. The website says completion in 2028, but the site has been largely stalled</a>, with the construction pit filled with rainwater for months. If there are regulatory reasons for the delay, the kind of thing Berlin's Schneller-Bauen-Gesetz</a> was meant to addres. Hopefully they're solvable.

The plot opposite JaHo — A 3,564 sqm</a> empty plot directly next to a U8 exit and on the S-Bahn line. Eyeballing the historical map on BORIS</a>, it looks like it was already empty back in 2002, when the land was valued at €2,800/sqm. Today it's €7,500, nearly €27 million. Over twenty years of doing nothing, and the value nearly tripled anyway. That's the whole problem in miniature. There is now a plan; the Central Tower Berlin</a>, a 105m mixed-use tower by HB Reavis, but as of April 2026, it's only just entering the design phase.

Alexanderplatz — Things are actually happening at Alex. The Berlinian</a>, a 146m office tower, had its topping-out in January 2026. The Covivio D3 tower</a> is rising nearby. But even here, there's a plot that's been empty since before Saturn was built. Here's a photo from 2001</a>, taken from the Fernsehturm. That plot? Still empty. Twenty-four years later.
This one's pretty interesting: The plot belongs to Hines, who in 2014 held an architectural competition for a 150-metre residential tower</a> — Frank Gehry won. 300 apartments, a hotel, restaurants, a $340 million project</a>. Construction was supposed to start in 2015. Then the BVG raised concerns about the U5 tunnel underneath</a>. The planning process stalled, restarted, and then... I'm not sure what happened. There may well be genuine engineering barriers. But whatever the reasons, a prime piece of Alexanderplatz has been sitting vacant for a quarter of a century while the city grew by hundreds of thousands of people. It makes you wonder whether the system creates enough urgency to work through those barriers, or whether it's just as easy to wait.


The Pattern</h2>
That's just what I spotted over three stops, looking out one side of the train. And the pattern isn't "nobody wants to build here." It's that almost every site has plans, some for over a decade, and things move glacially.
Berlin's Senate knows this. They passed the Schneller-Bauen-Gesetz</a> in December 2024, and just passed the Simple Construction Act</a> to cut costs and streamline permitting. That's good, regulatory reform matters.
Let's hope that helps replicate here what happened in Austin, Texas</a>. Austin had a similar problem, rapid population growth, rising rents, not enough housing. They loosened zoning, streamlined permitting, and let developers build. Nearly 50,000 new rental units hit the market in 2023 and 2024. Rents dropped 22% from their peak. Landlords started offering months of free rent to attract tenants.
The lesson is simple: when you actually build at scale and at speed, rents come down. Supply works.
So Why LVT?</h2>
Regulatory reform is necessary but not sufficient. Even if you make it easier to build, you also need to make it expensive not to. Right now, holding empty land in central Berlin costs very little relative to its value. A landowner can sit on a plot next to a U-Bahn exit for twenty years, watch the value triple from €2,800 to €7,500 per square metre, and face no real financial pressure to develop. Even Berlin having recently the fastest rising property prices in the world</a> wasn't enough to get these plots developed.
Land value tax changes that equation. It doesn't tell anyone what to build. It just makes holding prime urban land idle an expensive choice. The result is that development happens more broadly, more quickly, and earlier, ideally before things reach crisis point. It also encourages more of what we saw above with The Berlinian above: redeveloping an existing 5 story building into a 33 story one. That's a pretty extreme example, but would also encourage smaller changes like converting building attics into apartments.
Tarek Massalme is right that we need the equivalent of a new district. It doesn't need to be built from scratch far out, when you ride the S-Bahn through the centre of the city and start paying attention, you realise: a lot of that district is already planned in very central locations. It's just waiting. The question is how long we're willing to keep waiting.
This was also just one side of three very central S-Bahn stations, how many more locations/stories like this are there? Start thinking in land, and you'll see it everywhere.

This post is part of a series exploring land value tax and urban development in Berlin. I'm not an expert, this is just me learning in public. If you know more about any of the sites mentioned here, or if you disagree with anything, I'd love to hear from you.

Estonia's Land Value Tax: Good, But Underpowered

2026-03-22T00:00:00+00:00


Ah Estonia, any time you look into national administration, they get a shout out for being great (you can even get divorced online</a> there now). I visited Tallinn in 2022 and it was pretty sweet, hung out around Kalamaja, plus I bought a fluffy hat I still wear every winter. So when I came across this report</a> of Estonia having the world's most competitive tax system, with LVT</a> getting a mention, it felt like a good excuse to look closer.
Estonia is the only EU country that taxes land only, with buildings completely exempt: a pure land value tax in the Georgist sense. They've had it since 1993, shortly after independence, making it one of the longest-running real-world experiments in the idea. In true Estonian fashion, there's wonderful, clear documentation online about their land value tax</a> and how valuations are done</a>. Here are the key points.
How Estonia's LVT works</h2>
Rates are set locally, within national bands. Municipalities choose their rate within ranges set by national law: 0.1–1% of taxable land value per year for residential land, and up to 2% for other uses. In practice most municipalities land around 0.5–1%. This is considerably lower than Georgists typically advocate. The classic argument is that rates should be high enough that land speculation becomes unprofitable, which would require something significantly higher.
Per-plot automated valuation is new as of 2022. Previously, the mass valuation produced value zones, which local governments then used to calculate individual plot values. The 2022 law change</a> shifted this: the national assessment now directly determines a taxable value for each cadastral unit using automated statistical models, drawing on actual transaction data, land use type, area, and proximity to water, with no on-site inspections. The one partial exception is the city centres of Tallinn and Tartu, where human appraisers set per-neighbourhood building-rights values, with automated calculation applied from there. The full methodology is publicly documented</a>.
Valuations have happened in 1993, 1996, 2001, and 2022, with the next one due this year in 2026. The gap between 2001 and 2022 is the system's biggest practical weakness (more on that below).
The 2022 law change redesigned how valuations work, and the timing was urgent. Because land values had roughly increased sevenfold</a> in the two decades since the 2001 assessment, a sudden update to accurate values would have caused a massive tax shock. The new law established the per-plot automated methodology, the first valuation under it was carried out later in 2022, and the results took effect in 2024, but are being phased in gradually. Increases were capped at 50% or €20 in 2025, and local governments can set caps of 10–100% per year from 2026 onward until assessed values are fully reached.
What can we learn?</h2>
The English-language research I found on Estonia's LVT points in a consistent direction: the system works directionally, but is too underpowered to deliver the full Georgist promise.
On speculation: A 2012 study</a> found that Estonia did experience a significant speculative housing bubble in Tallinn between 2003 and 2008, and that a more rigorously implemented LVT would have acted as a buffer. The culprit wasn't the system design but the 2001 valuations being frozen in place: with no reassessment until 2022, the tax base drifted further from reality every year, reducing the anti-speculative effect.
On land utilisation: A study comparing Tallinn and Riga</a> (Latvia kept a building-based tax) found more inner-city development and multi-family construction in Tallinn, a detectable positive signal. But sprawl was equally strong in both cities, and prime central Tallinn plots were still being used as paid parking lots rather than developed. The rate, at around 1%, is simply too low: parking revenue can still comfortably cover the tax cost, so the holding incentive isn't broken.
On economic efficiency: An analysis</a> by the Organisation for Economic Co-operation and Development (OECD</a>) found that raising land taxation to OECD norms while cutting labour taxes could lift Estonia's potential GDP per capita growth by up to 0.7%. This is a structural efficiency argument: land taxes don't distort productive behaviour the way income taxes do, because taxing a fixed supply of land doesn't reduce the amount of land available. The OECD's conclusion is essentially that Estonia has the right structure but not nearly enough intensity.
So what does this mean for Berlin?</h2>
The Estonian case is useful less as a success story and more as a proof of concept with a clear diagnosis of its own limitations. It shows that:

Automated per-plot mass appraisal at scale is now demonstrated. Estonia has just shown it can be done nationally using transaction databases and statistical models, without committees or on-site visits. This is directly relevant to Berlin, where Bodenrichtwerte</a> (official land value maps) already exist as a regional data foundation. There's even research showing these can be carried out via statistical models</a>, in a higher granularity. </li>

Regular reassessment is not optional. The 2001–2022 gap turned a functional system into an ineffective one. The 2022 Land Valuation Act</a> now legally mandates four-yearly valuation cycles, which is a vast improvement. Annual would be better still, the closer the tax base tracks actual land values, the less room for speculative drift, but four years is a reasonable starting point for a national system. </li>

Rate matters enormously. A 1% LVT is simply not enough to change holding behaviour in valuable locations. Germany's new land value taxes are even lower in effective terms. If the goal is to make speculation unprofitable and idle land costly, the rate needs to be meaningfully higher, maybe in the 5-10% range to capture the full land rent values. </li> </ol>
Estonia's experience doesn't prove LVT works perfectly. But it does suggest the mechanism works in the direction theory predicts, and that the failure modes are about implementation (stale valuations, low rates) rather than the underlying idea. Personally, I kind of wish they'd just jack it up to 11, do annual appraisals, much higher rates, lower other taxes and see what happens. For Berlin, the Estonian case shows that the data infrastructure needed for a well-functioning LVT isn't theoretical: automated per-plot valuation at city scale is demonstrably achievable.

Amsterdam's Leasehold System: So Close Yet So Far from LVT

2025-10-28T00:00:00+00:00

Was travelling recently and met a nice person who is living Amsterdam. As usual around me the topic of land value tax (LVT)</a> came up. I didn't know anything about the property tax system for Amsterdam, and they said it was based on a leasehold system. Those have many similarities to land value tax, but Amsterdam also has insane property prices and rent (currently the highest in Europe</a>), so does that mean LVT doesn't work? Not at all. Amsterdam's story actually teaches us exactly why proper LVT matters—and what happens when you get almost everything right but miss one crucial detail.
Usual disclaimer: I'm not a pro in this field, and definitely not about Amsterdam, so there may be mistakes in the following. If anyone has expertise in Amsterdam's erfpacht system and can correct my understanding, please reach out!
1. What is the leasehold system?</h2>
Rather than people/buyers/businesses owning the land and property, Amsterdam retains the land ownership, and leases it to people who can then build on it. This is different from Henry George's idea of keeping private property ownership, but charging a land value tax based on the land rent. In practice it can be quite similar, since one is a tax based on the land rent, and the other is actually renting the land.
2. How is the lease price calculated</h2>
I'm still researching the exact details of how the calculation works, but based on what I've found so far (drawing a lot from this</a>): For existing buildings, Amsterdam calculates ground value by taking the property's market value (WOZ-waarde) and subtracting the construction costs. This residual method is actually a reasonable way to isolate land value from building value.
But here's where things go wrong: once they arrive at the land value, they don't charge based on plot size. Instead, they charge per square meter of housing area. As the municipality explicitly states, a 20 story building has more livable area than a 4 story building, so land rent for the 20 story building 5x the amount of that of the 4 story building. Since it's not based on plot size, which stays the same regarless of building size, larger buildings pay taxes in proportion to their size. This system has explicity no incentives for denser and more efficient land use, one of the major benefits</a> of Land Value Tax.

Een woonflat van 20 verdiepingen heeft een grotere totale grondwaarde dan een appartementencomplex van 4 verdiepingen. Zelfs als ze op een even groot perceel staan. De grondwaarde berekenen we namelijk per vierkante meter woningoppervlak. En dus niet per vierkante meter perceeloppervlak.
A 20-storey residential block has a higher total land value than a 4-storey apartment complex, even if they are built on plots of equal size. This is because we calculate the land value per square metre of living space, rather than per square metre of plot area.
[source</a>] [Translated with DeepL</a>] </blockquote>
I think this means that if a 500m² plot with 500m² house pays €X, then 500m² plot with 5,000m² apartment building pays €10X, not €X.
Should also say I'm vastly simplfying this analysis, there's also lots of brackets and building types etc, but I wanted to focus in on the most LVT relevant characteristics.
3. So close, yet so far: The tragic history</h2>
Amsterdam has nearly everything needed for successful land value capture: administration, valuation systems, appeals processes... even municipal land ownership, which isn't neccessary but probably helps politically since they the city is the land owner. Yet they undermine it all with the per-housing-area calculation, which defeats the density incentive that makes LVT economically powerful. Plus, that livable area requirement creates significant administrative overhead—measuring interior spaces, tracking renovations, defining what counts as "usable area." Plot size, by contrast, is trivially easy to measure and rarely changes.
How did they get so close yet miss this crucial detail? The history suggests good intentions gradually going astray with poor implementation:

In 1896, Amsterdam's leasehold system was introduced</a>, likely inspired by Henry George's ideas about capturing land value for the community. However, the original system had fixed 50-75 year terms without regular reassessment. This meant the system failed to capture rising land values as the city grew—precisely what it was designed to do.</li>
When lease terms expired, ground rent suddenly spiked to reflect decades of accumulated value growth, creating high uncertainty at renewal</a>. The system made adjustments based on general inflation, but this rarely captured actual real estate appreciation. Compare this to Kiautschou</a>, a German-administered territory in China that successfully implemented Georgist land value taxation around the same time. There, regular reassessments were built into the system from the start, allowing it to capture land value growth smoothly while still incentivizing development.</li>
The 2016-2017 reforms (General Conditions for Perpetual Ground Lease 2016</a>, English translation; Algemene Bepalingen voor eeuwigdurende erfpacht 2016 Amsterdam</a>, Dutch original), adopted by Municipal Council on June 22, 2016, attempted to address the spike problem by introducing "perpetual ground lease" (eeuwigdurende erfpacht), allowing residents to lock in rates or buy off the ground rent entirely. This also introduced the "livable area" details.</li> </ul>
4. Lessons for Berlin</h2>
Amsterdam's system does show that charging for land value doesn't break the housing market. Properties under leasehold sell for 3-6%</a> less than freehold properties—suggesting the land charges do affect prices rather than just being passed through.
For Berlin, Amsterdam offers both inspiration and warning.
The inspiration: Their administraion of complex municipal land ownership shows that land value tax at scale is possible. According to this source</a>, Amsterdam manages 200,000 leasehold contracts covering 80% of the city. The administrative systems work, should be easier for a land value tax system as they would be simpler than a leasehold system.
The warning: Details matter. Amsterdam built an impressive apparatus inspired by Georgist ideas but made two critical errors. By charging per square meter of housing instead of plot size, they eliminated the density incentive—the whole point of LVT. And by failing to regularly reassess land values, they failed to capture speculative gains, creating massive payment spikes when leases finally did renew after 50-75 years.
A proper land value tax based on plot size and location would:

Capture rising land values for the community</li>
Create strong incentives for density</li>
Discourage speculative holding of vacant land</li>
Use simpler, more transparent calculations</li> </ul>
Amsterdam got so close. They proved the administrative side works at scale. Berlin can learn from what they got right—and what they got wrong.

EU affordable housing policy consultation

2025-08-09T00:00:00+00:00

The EU has opened a public consultation for feedback on affordable housing policies</a>, follow that link to get to the questionnaire, and read more about the proposals. The consultation is anonymous (or public if you like), stays open till 17 October 2025, and might take about 5 minutes to fill in, so give it a go.
The purpose is the "gathering of additional evidence and knowledge that would help the European Commission identify policy actions for the Affordable Housing Plan". Unsurprisingly, I suggested a Land Value Tax, though also just that we should just build more housing in general. Did you know Austin, Texas built more housing and managed to lower rent by 22%</a>? It feels like it's one of the first times in years I heard about rents dropping.
At time of writing there have been 796 respondents, so if we get 8 people to reply then 1% of all suggestions could be for land value tax!
Now I realise filling in a survey may not be super effective, but I do believe any outlet to promote these ideas helps a little. Each small action matters - like pushing over dominos, you never know how far the effects might reach. He described it much better than I could, so let's let Henry George have the final word, from his book Social Problems (p243)</a>:

Let no man imagine that he has no influence. Whoever he may be, and wherever he may be placed, the man who thinks becomes a light and a power. That for every idle word men may speak they shall give an account at the day of judgment, seems a hard saying. But what more clear than that the theory of the persistence of force, which teaches us that every movement continues to act and react, must apply as well to the universe of mind as to that of matter? Whoever becomes imbued with a noble idea kindles a flame from which other torches are lit, and influences those with whom he comes in contact, be they few or many. How far that influence, thus perpetuated, may extend, it is not given to him here to see. But it may be that the Lord of the Vineyard will know. </blockquote>

LVT through history: Kiautschou

2025-05-14T00:00:00+00:00

Introduction</h2>
While Baden-Württemberg introducing a Land Value Tax (LVT)</a> was a recent development, it's not the first time Germany has implemented this policy. In the late 19th and early 20th century, there was in fact a German colony where the administration was very influenced by Georgism.
The place in question was Kiautschou Bay, China (now Qingdao). It was under German control from 1898 to 1914. I'll be primarily using the following sources for information on the history of how this colony came to be run in a Georgist manner, and how they implemented their tax policies. If I make any mistakes, please do let me know!

Land Reform in Kiaochow, China: From 1898 to 1914 the Menace of Disastrous Land Speculation was Averted by Taxation</a></li>
Kiautschou Bay Leased Territory Wikipedia entry</a></li>
Aus Kiautschous Verwaltung : die Land-, Steuer- und Zollpolitik des Kiautschougebietes / von W. Schrameier (English: From Kiautschou's administration : the land, tax and customs policy of the Kiautschou area / by W. Schrameier)</a></li> </ul>
Historical Context</h2>
In 1897 Germany occupied Kiautschou Bay</a>, China. Supposedly this was in retaliaiton for 2 German missionaries who were killed by the Big Swords Society</a> (cool name, also known as Great Knife Society, which is also a cool name), however Germany had been looking to create navel bases in East Asia as other colonial powers had done. After the missionaries were killed, the german Admiral von Diederichs wired "May incidents be exploited in pursuit of further goals?" which suggests such occupation somewhere was already the plan.
After negotiations with the Chinese government, Germany took a 99 year leasehold on the Kiautschou Bay. There was a disagreement within Germany as to whether this should be under the Imperial Colonial Office or Imperial Naval Office. At the time, the German colonies in Africa were experiencing agressive land speculation. The German Land Reform League</a> published articles petitioning the Colonial Office to change their policies to discourage such speculation. These articles were picked up by the some within Naval Office, including Alfred von Tirpitz and Admiral von Diederichs, who was the officer who took Kiaochow.
Von Diederichs succeeded in keeping the Kiaochow under the Naval Office. They proceeded to run the area under Georgist principles. von Diederichs is Quoted as saying "It was our firm conviction from the outset that land speculation with all its consequences, as we experienced them in other East-African coastal areas, had to be made impossible."
Kiautschou Bay stayed under German control until World War 1 in 1914, when the Japanese navy bombarded and occupied the territory.
Technical Implementation</h2>
The Kiautschou Bay Leased Territory was run with a Single Tax on land. Rather than being based on land rents (the cost to rent the land), there was a yearly tax of 6% of the purchase value. Henry George argued that around 85% of land rents should be taxed, and the rental price of land is often in the 4-8% range of the purchase price. So 6% of purchase price is quite a good approximation of George's suggested rate.
For comparison, Baden-Württemberg land value tax rate is ~0.045%, so here we're talking a tax rate that's over 100 times highter.
Land values were to be reassesed at regular intervals. There was also an "Increment Tax", which was 33% of the land value increase, which was to be paid every upon sale of the land, or every 25 years if the land was not sold. The increment tax apparently wasn't a fiscal policy, and was purely to discourage sepculation.
Economic Effects</h2>
The tax policy achieved their goal. The colony's revenue growth from 1899 to 1913, showing significant increases:

1899: 38,000 M.</li>
1906: 1,205,000 M.</li>
1909: 2,366,000 M.</li>
1911: 5,325,978 M.</li>
1912: 6,739,480 M.</li>
1913: 7,234,741 M.</li> </ul>
There was significant investment from Germany</a>, and the returns on that seem to have been capture by land value tax, rather than going to private land owners:

Germany invested upwards of $100 million in modernizing the territory of Kiautschou. The impoverished fishing village of Tsingtau was laid out with wide streets, solid housing areas, government buildings, electrification throughout, a sewer system, and a safe drinking water supply, a rarity in large parts of Asia at that time and later. The area had the highest density of schools and highest per capita student enrollment in all of China, with primary, secondary, and vocational schools funded by the Berlin treasury and Protestant and Roman Catholic missions </blockquote>
The revenue data shows it worked well - steady growth without speculative bubbles, reliable revenue generation, and apparent success in promoting development while preventing speculation.
Based on the steady revenue growth pattern, it's reasonable to conclude that had German administration continued, this tax model could have sustained further infrastructure investments without requiring external funding. The data shows a self-reinforcing cycle where public and private improvements increased land values, which then generated more tax revenue.
Comparative Analysis</h2>
The lack of land speculation stands in contrast to other colonies. The above mentioned German colonies in Africa had issues, but also Singapore and Hong Kong.
This quote from "Anecdotal History of Singapore"</a> p.89 suggests Sir Thomas Stamford Raffles (who is "largely credited for the founding of contemporary Singapore</a>") encouraged land speculation:

"When they were selling the filled up ground [near the Square] Mr. Raffles advised me to buy four or five lots, as afterwards this part of the town would become valuable. I answered where could I get money enough to pay for the land. I saw the lots selling at auction for $1,200 and $1,150, and there was besides the expense of building. Mr. Raffles smiled and said, never mind about the money, take the land first and we can talk about payment hereafter." Abdullah then expresses regret about not following this advice: "It was solely on account of my own stupidity and want of judgment that I lost this opportunity of purchasing land, by following Raffles' advice, and I now repent..." </blockquote>
That's the same Raffles as Raffles Hotel in Singapore, where the Singapore Sling was created.
Hong Kong also expirenced significant land speculation, as outlined in the book Building Colonial Hong Kong: Speculative Development and Segregation in the City by Cecilia L. Chu:

Despite persistent inequality, Hong Kong never ceased to attract diferent classes of sojourners and immigrants, who strived to advance their social standing by accumulating wealth, especially through land and property speculation </blockquote>
Unlike Singapore and Hong Kong, where land speculation created enormous wealth for a small number of landowners while burdening the broader economy, Kiautschou's LVT approach redirected land value increases to public coffers. The stark contrast demonstrates how different land policy choices can fundamentally shape a region's economic trajectory, even when starting from similar circumstances.
Colonial Context</h2>
While the implementation of LVT was effective from an economic perspective, we must acknowledge that this occurred within a colonial context, where local Chinese residents had limited political representation and autonomy (Schrameier, Aus Kiautschous Verwaltung, p149). Henry George himself criticized colonial rule precisely because it imposed economic systems without democratic consent, and devoted several chapters of Progress and Poverty criticising the British rule over Ireland, China, and India, and how their policies there caused millions of deaths due to famine.
The Kiautschou example offers valuable policy lessons about land taxation mechanics and economic outcomes, but it's important to separate these technical insights from the problematic colonial power structures through which they were implemented.
Lessons for Modern Implementation</h2>
The Kiautschou Bay Leased Territory shows how LVT can be useful in discouraging speculation and promoting sustainable development and efficient land usage in a new developing area. A high LVT provided strong, increasing revenue, and didn't hamper development.
While the contexts differ significantly—a 19th century colonial territory versus a 21st century democratic city—Berlin's current housing challenges stem from similar economic forces. Both situations involve valuable urban land, development pressures, and the potential for speculation to distort markets. Berlin, already in the grip of speculative price increases and facing a housing affordability crisis, cannot implement LVT on a blank slate as Kiautschou did. Instead, Berlin must navigate the transition from an established property system where speculative value has already been capitalized into land prices. This difference in starting points doesn't invalidate the underlying economic principles, but it does necessitate a more nuanced implementation strategy.
Sudden dramatic changes in policy would be very disruptive (as we're seeing currently with US tariff policy). While other places like the US and Hong Kong derive a lot of tax revenues from land/property taxes, in Germany it is currently a small proportion of tax income (income tax and VAT are the big ones here). So an introduction where the LVT on a similar scale to current property taxes (as Baden-Württemberg has done) would likely be more appropriate and politically acceptable.
The size of the tax is also interesting, 6% of land value is very high compared to many current land value taxes. So to achieve the benefits maybe it needs to be that high so speculators can't still make a profit. So while a low land value tax would still be preferable to our current property tax system (less administrative over head, easier to collect, can't be evaded, less forms to fill out), a gradual approach would be more appropriate - starting with a moderate LVT that grows incrementally over time while proportionally reducing other taxes (particularly those on improvements, labor, and business activity). This phased implementation would give property markets time to adjust while still signaling a clear long-term policy direction.
Another important lesson is that regular reassessments of values were also important to Kiautschou, and would also need to be considered. In 2017 berlin property prices grew 21%, making it the fastest growing in the world at the time</a> (with land values involved in driving this), it's clear how important it is to reassess frequently and accurately.
The benefits of implementing a meaningful LVT in Berlin would address several pressing issues:

Encourage efficient land use by making it costly to hold valuable land without developing it</li>
Reduce empty apartments and combat speculation - as Die Linke recently highlighted</a>: 'Mehr als 40.000 Wohnungen stehen in Berlin leer - trotz akuter Wohnungsnot!' (More than 40,000 apartments in Berlin are vacant despite acute housing shortage)</li>
Create a more stable housing market by reducing speculative price volatility</li>
Generate public revenue that could be invested in affordable housing and infrastructure</li> </ul>
Unlike punitive measures that only target vacant properties, LVT addresses the underlying economic incentives that make land speculation profitable in the first place. The Kiautschou experience shows how changing these incentives can transform development patterns.
Conclusion</h2>
The Kiautschou Bay example demonstrates several key lessons for modern LVT implementation:

Even at high rates (6% of land value), LVT didn't impede development - it actually facilitated it by discouraging speculation and encouraging productive use of land</li>
Regular reassessment of land values was crucial to the system's effectiveness</li>
Revenue generation increased steadily rather than following boom-bust cycles</li>
Public infrastructure could be funded through captured land value increases</li> </ul>
For Berlin, this historical case offers evidence that LVT can work effectively in practice, not just in theory. While Berlin's established property markets would require a more gradual approach than a new settlement, the fundamental economic principles remain valid. A well-designed LVT could help address Berlin's housing affordability challenges by discouraging land hoarding and speculation while generating revenue for public needs.
The Kiautschou experience also underscores the importance of designing systems that capture land value increases for public benefit - especially in rapidly appreciating markets like Berlin's.

Land value tax in Germany: Baden-Württemberg

2025-04-18T00:00:00+00:00

Back in 2018, the property tax system in Germany was unconstitutional, given that it was based on outdated values. We're talking like 1935 in the east, and 1964 in the west</a>, so wildly outdated.
Property tax in Germany is decided at the state level. There's a federal law (Grundsteuergesetz (GrStG)</a>), which the states can follow, or they can go off and do their own thing.
Berlin followed the federal law, but changed the tax rates as outlined in Berliner Grundsteuermesszahlengesetz - BlnGrStMG</a>. In §1 of the Berlin law, you can see that Berlin sets:

0.45‰ promille (0.045%) for undeveloped land</li>
0.31‰ promille (0.031%) for residential properties (§249 Abs. 1 Nr. 1-4 of the Valuation Law)</li>
0.45‰ promille (0.045%) for commercial properties (§249 Abs. 1 Nr. 5-8)</li> </ul>
Some states (Hamburg/Munich) did their own thing and made regressive taxes that punish density or commerce.
But one state did its own thing and was cool: Baden-Württemberg. Their property tax is now a full Land Value Tax (LVT)</a>. So no changes in tax based on land developments, just the land value. You can find the law "Landesgrundsteuer Baden-Württemberg (LGrStG BW)" here</a> (or in PDF form here</a> but I'm not sure what this link is).
If me (and https://claude.ai) are reading the law right, the formula for the tax is roughly:
Property Tax = Land Value × Tax Measurement Number × Municipal Multiplier </code></pre> Land value is the assessed price per square meter, by the land area. The tax measurement number (Steuermesszahl) according to §40 of the law is:For agricultural/forestry properties: 0.55‰ (0.055%)</li> For regular properties: 1.3‰ (0.13%)</li> </ul> The Hebesatz (Municipal Multiplier) allows local adjustment of the tax rate while maintaining relative property values. There's also reductions to the Tax Measurement Number: 30% reduction for properties predominantly used for residential purposes</li> Additional reductions of 25% for subsidized housing</li> Additional reductions of 25% for properties owned by public housing companies</li> 10% reduction for properties with cultural monument status</li> </ul> Land value is determined using Bodenrichtwerte (standard land values), which are assessed by local valuation committees based on actual market transactions. Baden-Württemberg has BORIS-BW</a>, which allows anyone to view the official land values in the state. There's a great talk by professor Dirk Loehr to the Henry George School of Social Science</a> that I can highly recommend. It has many interesting details, covering the legal situation of the previous unconstitutional property tax, the politicians in Baden-Württemberg that were in a position to pass a LVT law, and how they went about coalition building and convincing various different groups to support the measure. It also notes (at 1:45:40) how surprising that of all places Baden-Württemberg was the state where this was introduced, given it is generally politically conservative and doesn't have very advanced land valuation systems. The law came into effect in January 2025, so I haven't found any reports yet on what changes have resulted. Also the level of tax is quite low, so I'm not sure how dramatic the effect will be. However it's still a significant achievement for several reasons. First, it demonstrates that it's possible to implement a pure land value tax through democratic processes at a state level. Second, it establishes that LVT is constitutionally valid in Germany (an important hurdle, given that the previous property tax system failed this test). Third, it creates a real-world laboratory for studying the practical administration of land value taxation. This pilot program will provide valuable empirical evidence about implementation challenges, particularly around land valuation methods, administrative costs, and public acceptance. These lessons will be invaluable for other jurisdictions considering similar reforms. While the immediate economic impact may be modest due to the low tax rates, the policy precedent set by Baden-Württemberg represents an important step toward broader adoption of land value taxation as a viable alternative to traditional property tax systems.
Money isn't wealth 2025-03-26T00:00:00+00:00 Reading Progress and Poverty (Henry George) and Killing the Host (Michael Hudson) has challenged many of my economic assumptions. Among their crucial insights is that money isn't wealth - a distinction that requires carefully separating the productive economy from the unproductive one. This conceptual divide matters profoundly because our failure to distinguish actual wealth creation from financial claims has led to policies that prioritize asset values over productive capacity, driving inequality and economic instability. According to George, wealth is: "tangible goods that satisfy human wants"</li> "Products that result in applying labour to land or natural resources"</li> "Things with actual value beyond their role in exchange"</li> </ul> So let's take a house. Someone builds it, they have created wealth, which is the house. Now if someone uses money to buy that house, they gained wealth (the house), and the other person gained money... so what do they have if they just have money? In this case money is "the medium of exchange", or you could say they have "a claim on other wealth". They can use that money to get roughly one house worth of other wealth. eg another house, several cars, a lifetime supply of beer... A very different example of producing wealth would be a dance class. While Henry George focused primarily on physical goods in his writing, a modern application of his framework would recognize services as creating value that satisfies human desires. The dance class requires labor (the work and training of the dance instructor), takes place in a location (so there is a land component), and satisfies the attendees' want to learn to dance - fulfilling the essential elements of wealth creation, even though the value is created and consumed simultaneously. It's important to separate between: Actual wealth: produced goods with intrinsic value</li> Medium of exchange: money</li> Claims on wealth: financial instruments, debts...</li> </ul> Some more examples, let's say you buy the above house with a mortgage. That mortgage is a claim on wealth, either through ongoing payment, or possessing the house should you fail to make those payments. Stocks in a company represent claims on a companies assets and future profits. Bonds are like an IOU, representing the promise of repayment and interest Insurance is claims of compensation in some agreed circumstance, not wealth in itself. That's why it's important to distinguish between the productive economy and the financial economy. It's possible to issue bigger loans, print more money, transfer ownership of wealth more frequently, without actually making more wealth. GDP (gross domestic product) is generally used as a measurement of economic activity. These financial instruments are included in the product, so building a house or the interest payments on a mortgage, both are included in the "product". But in the later case, nothing is actually produced. If you buy a 100 year old apartment with a mortgage, the economy is more productive, even though all that has been added is a claim on wealth, not actual wealth. I have left rent out so far, but including that the picture of how we measure economic activity gets even worse. Rent on land is a cost to be paid to access that land. So it represents a claim on actual wealth produced by labour and capitalists. It's redirecting wealth to landowners without them needing to produce anything. Going back to the dance class example, assuming they are renting the location for the class, then as rents go up that will result in increased costs to the attendees or decreased pay to the instructor. Even though no additional service is being provided, GDP records this as increased economic activity. These rent costs for renters and home owners (via imputed rent) are counted to increasing GDP. If you're wondering why the news reports that GDP is growing but everything feels the same or worse, this can be why. This distinction between real wealth and financial claims points us toward better solutions. When we recognize that much of what we count as "economic growth" is actually just the expansion of claims on wealth rather than wealth creation itself, we can design policies that target the root issue. A land value tax is one such policy that follows directly from this understanding. By taxing the unearned value of land, we reduce the incentive for speculation and redirect value that would otherwise be captured by landowners (or financial institutions via mortgages) back to the community. This approach acknowledges that land value isn't wealth created by the owner, but rather a cost the productive economy has to pay for access. The result would be lower land costs, increased building development, reduced rents, and ultimately an economy that prioritizes actual wealth creation over financial extraction. While a land value tax is a powerful tool for addressing land monopoly, a comprehensive approach would include additional reforms targeting other aspects of our financial system. Michael Hudson, in his book Killing the Host, explores this broader landscape with measures designed to reduce the FIRE (Finance, Insurance, Real Estate) sector's dominance over the productive economy. His proposals include debt write-downs, creating public banking options, and reviving classical economic understanding of rent extraction. For readers interested in a more complete picture of economic reform possibilities, Hudson's work offers valuable insights into how our financial architecture could be restructured to support rather than extract from the real economy. Privatising public wealth, socialising private wealth 2025-03-06T00:00:00+00:00 Who benefits when a city government improves something? The bike lanes on Sonnenallee</a>, extending the U5 from Alexanderplatz to Hauptbahnhof, investing 609 million in 86,000 Kita places</a>. On the one hand, the community benefits, they get to cycle more safely, commute easier, have more access to childcare. On the other hand, this increases the value of land and rents around, so it benefits the nearby owners. Berlin's Prosperity Paradox</h2> Recent headlines tell a troubling story: "Transport, culture and tax: How Berlin's budget cuts could affect you" (The Local, 2025)</a>. After years of public investment that transformed Berlin into a thriving tech hub and cultural center, the city now finds itself needing to cut €3 billion from its budget—potentially eliminating the €29 public transport ticket, reducing cultural funding, and increasing tourist taxes. This paradox reveals the fundamental problem: Berlin is being choked by its own prosperity. As the city invested in better infrastructure, cultural amenities, and public services, it made Berlin more desirable. But instead of this increased desirability benefiting all Berliners, much of the value was captured by landowners through rising property values and rents. Meanwhile, the productive economy that generates actual tax revenue faces increasing housing costs that limit growth. Modern Georgists refer to this as privatising public wealth via land prices, and socialising private wealth via taxes (an example of a similar discussion can be found here on earthsharing.ca</a>) So what happens is we're taxing productive activities, and rewarding unproductive activities like land ownership and speculation. Work is taxed through income tax, businesses are taxed on their profits, and anyone who buys anything ever is a taxpayer thanks to VAT. When this tax is collected, it's used to improve the community, which is a desirable goal. But under this system, we're caught in a self-defeating cycle: the productive economy is taxed to fund improvements, only to then pay again through higher rents and land prices for access to those very improvements. And as we're seeing in Berlin, those rent increases can be enormous, effectively canceling out the productivity gains that funded them in the first place. The budget cuts we're now facing are a direct consequence of this system: a city that created tremendous value through public investment now cannot afford to maintain those investments because it failed to capture the land value increases it generated. Henry George called this</a> back in the 19th century: "Take now...some hard-headed business man, who has no theories, but knows how to make money. Say to him: "Here is a little village; in ten years it will be a great city—in ten years the railroad will have taken the place of the stage coach, the electric light of the candle; it will abound with all the machinery and improvements that so enormously multiply the effective power of labor. Will in ten years, interest be any higher?" He will tell you, "No!" "Will the wages of the common labor be any higher...?" He will tell you, "No the wages of common labor will not be any higher..." "What, then, will be higher?" "Rent, the value of land. Go, get yourself a piece of ground, and hold possession." And if, under such circumstances, you take his advice, you need do nothing more. You may sit down and smoke your pipe; you may lie around like the lazzaroni of Naples or the leperos of Mexico; you may go up in a balloon or down a hole in the ground; and without doing one stroke of work, without adding one iota of wealth to the community, in ten years you will be rich! In the new city you may have a luxurious mansion, but among its public buildings will be an almshouse." </blockquote> Worth noting at this point, here is an empty plot of land directly on Alexanderplatz, as seen on the left here surrounded by hoarding: ... and here's a graph of its land value according to BORIS</a>: Not being content with merely identifying the problem, Henry George also proposed a solution: a Land Value Tax</a>. This approach would address rising rents and land prices directly, but its true power emerges when combined with reductions in taxes on productive activities. If we're currently caught in a self-defeating cycle of taxing production while subsidizing land speculation, we should break that cycle at both points. Add a citizen's dividend</a> (also known as a UBI, Universal Basic Income</a>) funded by land value, and suddenly we have a system that rewards productivity, discourages speculation, and ensures everyone benefits from our shared prosperity. It's difficult to imagine a more elegant solution that's so tantalizingly within reach. In Henry George's words: "A tax upon land values is, therefore, the most just and equal of all taxes. It falls only on those who receive a unique and valuable benefit from society. And it falls on them in proportion to the benefit they receive. It is taking by the community, for the use of the community, from the value that is the creation of the community. It is the application of the common property to common uses. When all rent is taken by taxation for the needs of the community, equality will be attained. No citizen will have an advantage over any other, except through personal industry, skill, and intelligence. People will gain what they fairly earn. Only then, and not until then, will labor get its full reward, and capital its natural return. " — Henry George, Progress and Poverty, Book VIII, Chapter 3</a> </blockquote> We've seen austerity repeatedly fail across Europe since 2008. Berlin now faces the same spiral: public investment creates value, private landowners capture that value, and the city is forced to cut services that made it desirable in the first place. This isn't inevitable. A Land Value Tax would allow Berlin to recapture the value it creates, funding public services without burdening productive activities. Combined with reductions in income and business taxes, it would create a virtuous cycle instead of our current self-defeating one. Imagine a Berlin where: Public transport remains affordable and expands rather than contracts</li> Cultural funding increases, maintaining Berlin's creative spirit</li> Housing becomes more affordable as speculation decreases</li> Empty lots like the one on Alexanderplatz are developed rather than hoarded</li> Entrepreneurs and workers keep more of what they earn</li> </ul> This isn't utopian thinking—it's sound economics that aligns incentives with community wellbeing. The question isn't whether Berlin can afford this change, but whether it can afford not to make it. Berlin's Faster Construction Law 2025-02-27T00:00:00+00:00 As I wrote in the pool redevelopment piece</a>, I was worried about the timeline and delays around that project. When researching more about delays, I found out that Berlin passed the Faster Construction Law (Schneller-Bauen-Gesetz) in December 2024. You can read the English announcement here</a>, further details in German here</a> and the full law here</a> (which seems hosted on the Berlin Chamber of Architectures, I'm struggling to find a copy of the law on official websites). It'll take me a while to dig into all the details, but there's some changes around timelines and approvals I find quite interesting. First, the law sets strict timelines for administrative review: Authorities get 4 weeks to check if an application is complete and request missing documents</li> Once complete, agencies have 1 month for review</li> Can get 1 extra month if multiple agencies need to coordinate</li> Heritage protection decisions get another month on top</li> </ul> If these deadlines aren't met, something powerful happens: the application is automatically approved. This "default approval" mechanism means: No response = approval ("gilt das Einvernehmen als erteilt")</li> Only limited exceptions (like major traffic impacts)</li> </ul> This is a big deal because it fundamentally changes the incentives. Previously, bureaucratic delay meant projects got stuck in limbo - potentially forever. Now, delay works in favor of the applicant, resulting in automatic (though revocable) approval. This creates real pressure on authorities to process applications within their deadlines, while giving developers certainty about maximum wait times. Another interesting aspect is provisions applying to the following categories of projects: housing with 50+ units</li> Schools and daycare centers</li> Commercial projects with >3000sqm area</li> Public utility infrastructure These have a pre-application conference including decision makers from all relevant departments, and must be held within a month of request. The aim seems to be to get potential issues highlighted early, and to get comprehensive input to prevent later delays from sequential reviews.</li> </ul> As this law focuses on administrative and approval processes rather than tax, zoning, density rules, it doesn't directly address many Georgist concerns about land use and speculation. However, it does give Berlin right of first refusal on property sales, giving the city opportunities to acquire strategic land when it comes on the market. There are also provisions to help streamline adding extra floors to buildings and converting existing structures to housing. So while not tackling core Georgist issues (like capturing community-created value through Land Value Tax or separating land value from improvements), it should at least encourage more efficient use of existing land and buildings. As the law is quite new, I haven't been able to see how it plays out in practice yet. However it seems to be written with a strong emphasis on building more and faster (it is in the name after all) which is quite encouraging. I'll be keeping an eye out to see if it helps. More of This Please: Pool Becomes Housing + Better Pool 2025-02-08T00:00:00+00:00 I was getting into swimming back in 2022, and remembered there was a pool near me on Holzmarkstrasse. Unfortunately, it turns out the pool was closed in 2018. Now in 2025 it's been closed for 7 years, you can see it here as the small building in the middle with graffiti on it. So I was quite happy this week when I stumbled across this blog by Berliner Bäder</a>. The pool site, which is currently derelict, is being redeveloped into a new pool with double the capacity, along with retail space, office space, around ~375 apartments and an open roof area. This plot is Holzmarktstrasse 51, and is quite centrally located, near Jannowitzbrucke Sbahn, and about 1.5km from Alexanderplatz. If you enter that address into BORIS</a> (BOdenRichtwertInformationsSystem, rough traslation is "Land Value Information System") you can see this land is worth 2400 Euro/m², though is right on the border with land worth 11000 Euro/m² (reflecting its proximity to the river and excellent transport connections). The BORIS land values are by zone rather than by plot (and zones can cover several blocks and hundreds of meters), so I guess the 2400 Euro/m² for this plot is probably an underestimation. The stark difference in land values between nearby plots (2400 vs 11000 €/m²) highlights how location-based value can vary dramatically even within a small area. This is exactly the kind of unearned value that Land Value Tax (LVT)</a> is designed to capture - value created by the community, nature, and city infrastructure rather than by the landowner themselves. Interestingly, this valuable plot is publicly owned - it belonged to Berliner Bäder-Betriebe who are selling it to Berlinovo, another public entity. While public entities might be exempt from traditional property taxes, the principles of Land Value Tax still apply here: valuable urban land should be used efficiently regardless of ownership. The opportunity cost of leaving prime location land underutilized for 7+ years is the same whether the owner is public or private It's encouraging to see this being redeveloped for mixed use. This site's evolution - from public pool, to a planned mixed-use development with housing and doubled pool capacity - illustrates a key Georgist</a> principle about urban development. As cities grow, valuable urban land should naturally transition to more intensive uses that serve more people. This project shows that principle in action: where once there was just a pool, soon there will be both a larger pool and 375 apartments, plus office and retail space. The added roof garden even makes use of that vertical dimension for more green space. This kind of mixed-use development with high density is exactly what we'd expect to see more of under an LVT system, where holding valuable land vacant or underutilized becomes much more expensive. According to the Berliner Bäeder post, construction is due to start in 2026. That's 8 years after the pool has been closed, which seems like a long time. Digging deeper, I found this article from Berliner Woche</a> from 2021 about the developent. It says "Läuft alles wie geplant, könnte das Schwimmbad 2025 in Betrieb gehen" (rough translation: "if everything goes to plan, the pool should be operational by 2025"), so it looks like everything did not go to plan. The timeline of this project raises important questions about Berlin's development process. Even with public ownership and clear public benefit (both housing and a swimming pool), it's taken over 7 years and counting to redevelop this valuable central plot. While LVT usually focuses on private landowners, this case shows how the principles of efficient land use apply equally to public land. That delay in developing 375 needed apartments and expanded public facilities suggests that we need better systems - both tax-based and administrative - to encourage optimal use of all urban land. The final mixed-use design, combining public infrastructure with housing and commercial space, shows what's possible - we just need to find ways to make it happen faster and more often. Tale of Two Plots: When Land Rent Seems Too Cheap 2025-01-30T00:00:00+00:00 So turns out you can just go online and see how much it costs to rent or buy empty plots of commercial land in berlin. Lets compare 2 similar ones! We'll compare one at Gürtelstraße 40</a>, and another at Frankfurter Allee 58</a>. They're both located in Friedrichshain, 10247 Berlin, about 900 meters apart, so that's a 12 min walk according to Apple maps. I took a look at these on the 29th of January 2025, the rest of this post is based on the listing details as of then, though they may have changed afterwards. GurtelStrasse 40</h3> The plot is located between two hotels, the back seems to be on to the ringbahn, seems to be across from a little park. It's about a 7 min walk to the S bahn Frankfurter Allee, a little less to the ubahn. Frankfurter Allee 58</h3> This one right on a busy street, most the buildings either side seem ground floor commercial with residential above. It's sarcastically close to the ubahn samariterstr, like maybe 12 meters. The numbers:</h3> Gürtelstraße 40: size 531sqm, price sale of 3,300,000e, 6214e/sqm</li> Frankfurter Allee 58: size 300sqm, rent price of 24000e per year, 80e/sqm/year</li> </ul> ... that rent price seems suspiciously low when compared to the other purchase price. Here's the math: Gürtelstraße is selling for €6,214 per square meter. If we assume Frankfurter Allee's land is worth the same (not the worst assumption given they're so close), its 300 square meters would be worth €1,864,200 (300 × €6,214) The annual rent of €24,000 as a percentage of this land value gives us a rental yield of just 1.29% (€24,000 ÷ €1,864,200) That's a remarkably low return for a commercial property - if your goal was rental income, you could do much better putting that money elsewhere. So what's going on here? What's up with that rent?</h3> Digging into the listings, we see the Gurtelstr is selling for someone to develop. The listing gives reports on the state of the ground for construction, and makes a big deal of the hotels next to it to tout its commercial potential. Whereas Frankfurter Allee is specifically a short term lease, which give the owner a lot of power to end it, stresses "Freifläche" which (I think) is like "open space", so like gardens/car parks etc. It also has a "notarielle Zwangsvollstreckungsunterwerfung" (notarized submission to immediate enforcement) requirement, which is a legal instrument to make evictions easier. It also includes a "annual increase of €1/sqm" to rent which is unusual according to the LLM I asked (claude.ai). All that would suggest a much higher rental yield for actual development on this land. So what might explain this unusually low rental yield at Frankfurter Allee? I don't know but here are some of my guesses: The owner could be waiting on planning permission before development, using short-term rentals to generate some income during the process. If this is the case, it would suggest Berlin's planning system needs improving - right now it's leaving prime land next to public transit sitting underutilized.</li> The owner might be primarily interested in capturing rising land values in this rapidly developing area of Friedrichshain. The short-term lease terms, easy eviction clause, and built-in rental increases all suggest they want to maintain flexibility for future plans. In this scenario, the rental income is just a small bonus while they wait for land values to appreciate further.</li> There could be other factors I'm not seeing - perhaps issues with the land itself, local regulations, or specific arrangements between the parties involved.</li> </ul> What Could Make This Better?</h3> As this blog explores Georgist ideas for Berlin, cases like these two plots offer fascinating insights into how our current property system shapes land use. From a Georgist perspective, the Frankfurter Allee situation perfectly how property taxes based on improvements (rather than land value) can create unexpected incentives. There's currently no tax disadvantage^{1</a> to keeping prime transit-adjacent land in low-intensity use while land values appreciate.} This brings us to an interesting question: how could a land value tax change these dynamics? Under an LVT system, holding prime land for speculation becomes more expensive - the tax is based on the land's potential value, not its current use. The Frankfurter Allee situation is particularly revealing here. This empty plot next to a U-Bahn station would face the same tax bill as the neighboring productive mixed-use developments. An LVT would create strong incentives for all valuable urban land to be put to productive use. And what about that €6,214/sqm price tag at Gürtelstraße? How does that land cost affect development viability, and what role could LVT play in making development more feasible? I'll explore these questions in a future post. ^{1 Berlin's new property tax does have a slightly lower rate for developed land (0.31 promille vs 0.45 promille, or 0.031% vs 0.045%). These tiny fractions of a percent create even less pressure to develop when compared to annual land value increases. </div>} Understanding Land Value Tax: A Foundation for Berlin's Future 2025-01-27T00:00:00+00:00 As Berlin's housing crisis continues, it's clear changes need to be made. One change I haven't seen get much attention is the Land Value Tax (LVT), an idea proposed by Henry George. I can see how a tax might not be very appealing, however a Land Value Tax is a surprisingly elegant idea that could help address some of our city's pressing issues. There's plenty</a> of other descriptions</a> of LVT</a> online, but here's one more anyway! What Is Land Value Tax (LVT)?</h2> Land Value Tax is exactly what it sounds like: a tax on the value of land, independent of any buildings or improvements on it. While that might seem simple, this distinction from traditional property tax has profound implications for how our city could develop. The Key Distinction: Land vs. Improvements</h3> Imagine walking down a street in Kreuzberg and seeing two adjacent plots: One has a five-story apartment building housing multiple families</li> The other is an empty lot, maybe used for parking or something</li> </ul> That building is an example of an "improvement", as could many things (parks, tennis courts, irrigation systems...) Under current property tax systems, the apartment building owner pays significantly more tax than the empty lot owner. With LVT, both would pay the same tax because they occupy equally valuable land. This change creates strong incentives to use land more efficiently. How Does It Work?</h2> Interestingly, LVT is generally based on the rental income of land, rather than the purchase price of land itself. Let's break down the mechanics with a simple example: Land Value: A plot of land in a desirable area of Berlin might have a land value that would cost €100,000 per year to rent</li> Tax Rate: With a 10% LVT, the owner would pay €10,000 annually</li> Buildings Don't Matter: Whether there's a single-family home or a 50-unit apartment building, the tax remains the same</li> </ol> This system encourages putting valuable land to its best use, rather than leaving it vacant or underutilized. Why It Matters for Berlin</h2> There are some key advantages make LVT particularly relevant for our city: 1. Encourages Development Where It's Needed</h3> Unlike property tax, LVT doesn't penalize building improvements. This could help address Berlin's housing shortage by encouraging development of vacant lots in high-demand areas, and further developing existing structures, all of which would increase supply. 2. Reduces Speculation</h3> In rapidly developing neighborhoods like Wedding or Lichtenberg, LVT would make it costly to hold empty lots waiting for prices to rise. This could help stabilize land prices and encourage steady, sustainable development. 3. Captures Community-Created Value</h3> When a new U-Bahn station or park makes a neighborhood more desirable, that added land value comes from public investment and community development. LVT returns some of that community-created value to the public. 4. Could Replace Less Efficient Taxes</h3> Taxes on income or business activity can discourage productive work. However since land is in fixed supply LVT has no negative impact on economic activity. Revenue from LVT could potentially replace or reduce other taxes that currently distort Berlin's economy. For example, reducing business taxes could make the city more attractive for startups and growing companies while maintaining public revenue through LVT. Given how it doesn't have distortionary effects, Henry George went even further and proposed replacing all taxes with a single tax</a> on land value, and returning that value to the community in the form of a basic income, called a Citizens Dividend</a>! Common Questions</h2> "Isn't This Just Another Property Tax?"</h3> No - and the difference is crucial. Property tax charges you more for building housing or businesses. LVT charges the same regardless of what you build, encouraging development rather than penalizing it. "How Do You Determine Land Value?"</h3> This is one of the key pratical challenges - one that deserves its own detailed exploration. Berlin already maintains detailed land value maps (Bodenrichtwerte</a>) which could serve as a starting point. I plan to have future posts on this topic. The Philosophy Behind It</h2> Henry George, who popularized this idea in his book Progress and Poverty</a>, made a compelling ethical case: While buildings are created by people, land value is largely created by either nature or the community. The desirability of land in Prenzlauer Berg or Kreuzberg comes from public infrastructure, cultural amenities, and the people of Berlin who made these neighborhoods vibrant. So LVT is a way to give that value back to the community that created it, which I find rather elegant. Looking Ahead</h2> This introduction scratches the surface of how LVT could work in Berlin. In future pieces, I'll explore: How Berlin's current property tax (Grundsteuer) system works</li> Specific examples of how LVT might affect different Berlin neighborhoods</li> Implementation challenges and potential solutions</li> Lessons from cities that have implemented similar systems</li> </ul> Want to Learn More?</h2> The links throughout lead to more resources you can explore to learn about LVT, Henry George, and Georgism. I'm also happy to discuss these topics further, so do feel free to get in touch! I'm particularly interested in hearing: Which aspects of LVT you'd like to understand better</li> Specific concerns about how it might work in Berlin</li> Examples of vacant or underutilized land in your neighborhood</li> </ul> This is part of a series exploring how Land Value Tax could help address Berlin's urban development challenges. Can Georgism save berlin? 2025-01-25T00:00:00+00:00 Hey everybody! I'm Alex, an Irish guy who's been watching Berlin's housing crisis unfold over my 15 years living here. Like many of you, I've seen rents skyrocket and wondered what can be done about it. Then I stumbled across this interesting idea called Georgism after reading this book review by Lars Doucet</a>. There's been a lot of words written about Berlin's housing crisis, but Georgism doesn't come up much in the discussion, so that's where this blog comes in. For those who don't know, Georgism is an economic ideology proposed by Henry George in the 19th century. He had a lot to say about rent and what causes it to increase, but more importantly he also had ideas on how to solve that. His main suggestion was a "Land Value Tax", which is a tax on the rental income of just the land itself independent of the improvements to it (you can think of improvements as buildings or roads or tennis courts or whatever). Doesn't sound like a big deal phrased like that but it has some big implications: reduce rents</li> reduce speculation</li> reduce inequality</li> can be used to reduce other regressive taxes (income tax, VAT...)</li> more efficient land use</li> </ul> That "reduce rents" point might sound counterintuitive - how could a new tax lower rents? Let's take an example: if you own a vacant lot in Mitte worth €2M, you'll pay a hefty tax based on that prime location - whether you build apartments on it or not. Since the tax bill comes either way, leaving the lot empty becomes extremely expensive. Most owners would need to develop the land just to generate enough income to cover the tax. When lots of owners face this same pressure to build, we get more housing supply, which helps bring down rents across the city. Plus since land can't be moved to the Caymen Islands, the rich can't tax evade a land value tax! All of this sounds pretty sweet, and is maybe just what Berlin needs... and maybe a few other places too, nobody is saying great things about rent in Dublin, London, Paris, New York, San Francisco, Amsterdam, the list goes on. So with this blog I will explore Georgism and Land Value Tax in the context of Berlin. This should take me down many paths, from the theory and history of Georgism, to Berlin politics/law/activism, and various forays into land valuation, tax rules, economics and beyond. I don't have any particular experience to prepare me to tackle such a broad topic, but hey let's see how far I get and what mistakes I make! I'm excited to dig in and share what I learn along the way. My next few posts will cover: A deeper dive into how LVT actually works</li> What Berlin's current property tax looks like</li> Some interesting examples of LVT in practice</li> </ul> If any of this sounds interesting to you, you can follow along at: This blog</a></li> This RSS feed</a></li> Instagram</a></li> </ul> And if you have any relation to this or related areas, it'd be great to hear from you! Please do reach out to me on social media or at alex@enough.berlin</a>

Frankfurter Allee 58</h3>
This one right on a busy street, most the buildings either side seem ground floor commercial with residential above. It's sarcastically close to the ubahn samariterstr, like maybe 12 meters.</p>
</p>

Why It Matters for Berlin</h2>
There are some key advantages make LVT particularly relevant for our city:</p>

2. Reduces Speculation</h3>
In rapidly developing neighborhoods like Wedding or Lichtenberg, LVT would make it costly to hold empty lots waiting for prices to rise. This could help stabilize land prices and encourage steady, sustainable development.</p>

3. Captures Community-Created Value</h3>
When a new U-Bahn station or park makes a neighborhood more desirable, that added land value comes from public investment and community development. LVT returns some of that community-created value to the public.</p>

"Isn't This Just Another Property Tax?"</h3>
No - and the difference is crucial. Property tax charges you more for building housing or businesses. LVT charges the same regardless of what you build, encouraging development rather than penalizing it.</p>

"How Do You Determine Land Value?"</h3>
This is one of the key pratical challenges - one that deserves its own detailed exploration. Berlin already maintains detailed land value maps (Bodenrichtwerte</a>) which could serve as a starting point. I plan to have future posts on this topic.</p>

enough.berlin

If You Want to Tax the Rich, Tax the Land

Three stops and a lot of waiting

Estonia's Land Value Tax: Good, But Underpowered

Amsterdam's Leasehold System: So Close Yet So Far from LVT

EU affordable housing policy consultation

LVT through history: Kiautschou

Land value tax in Germany: Baden-Württemberg

Money isn't wealth

Privatising public wealth, socialising private wealth

Berlin's Faster Construction Law

More of This Please: Pool Becomes Housing + Better Pool

Tale of Two Plots: When Land Rent Seems Too Cheap

Understanding Land Value Tax: A Foundation for Berlin's Future

Can Georgism save berlin?

enough.berlin

If You Want to Tax the Rich, Tax the Land

Three stops and a lot of waiting

The Pattern</h2> That's just what I spotted over three stops, looking out one side of the train. And the pattern isn't "nobody wants to build here." It's that almost every site has plans, some for over a decade, and things move glacially.</p>

Estonia's Land Value Tax: Good, But Underpowered

Amsterdam's Leasehold System: So Close Yet So Far from LVT

EU affordable housing policy consultation

LVT through history: Kiautschou

Economic Effects</h2> The tax policy achieved their goal. The colony's revenue growth from 1899 to 1913, showing significant increases:</p>

Comparative Analysis</h2> The lack of land speculation stands in contrast to other colonies. The above mentioned German colonies in Africa had issues, but also Singapore and Hong Kong.</p>

Land value tax in Germany: Baden-Württemberg

Money isn't wealth

Privatising public wealth, socialising private wealth

Berlin's Faster Construction Law

More of This Please: Pool Becomes Housing + Better Pool

Tale of Two Plots: When Land Rent Seems Too Cheap

Frankfurter Allee 58</h3> This one right on a busy street, most the buildings either side seem ground floor commercial with residential above. It's sarcastically close to the ubahn samariterstr, like maybe 12 meters.</p> </p>

The numbers:</h3> Gürtelstraße 40: size 531sqm, price sale of 3,300,000e, 6214e/sqm</li>

Understanding Land Value Tax: A Foundation for Berlin's Future

The Key Distinction: Land vs. Improvements</h3> Imagine walking down a street in Kreuzberg and seeing two adjacent plots:</p>

How Does It Work?</h2> Interestingly, LVT is generally based on the rental income</em> of land, rather than the purchase price of land itself. Let's break down the mechanics with a simple example:</p>

Why It Matters for Berlin</h2> There are some key advantages make LVT particularly relevant for our city:</p>

2. Reduces Speculation</h3> In rapidly developing neighborhoods like Wedding or Lichtenberg, LVT would make it costly to hold empty lots waiting for prices to rise. This could help stabilize land prices and encourage steady, sustainable development.</p>

3. Captures Community-Created Value</h3> When a new U-Bahn station or park makes a neighborhood more desirable, that added land value comes from public investment and community development. LVT returns some of that community-created value to the public.</p>

"Isn't This Just Another Property Tax?"</h3> No - and the difference is crucial. Property tax charges you more for building housing or businesses. LVT charges the same regardless of what you build, encouraging development rather than penalizing it.</p>

Can Georgism save berlin?

Frankfurter Allee 58</h3>
This one right on a busy street, most the buildings either side seem ground floor commercial with residential above. It's sarcastically close to the ubahn samariterstr, like maybe 12 meters.</p>
</p>

Why It Matters for Berlin</h2>
There are some key advantages make LVT particularly relevant for our city:</p>

2. Reduces Speculation</h3>
In rapidly developing neighborhoods like Wedding or Lichtenberg, LVT would make it costly to hold empty lots waiting for prices to rise. This could help stabilize land prices and encourage steady, sustainable development.</p>

3. Captures Community-Created Value</h3>
When a new U-Bahn station or park makes a neighborhood more desirable, that added land value comes from public investment and community development. LVT returns some of that community-created value to the public.</p>

"Isn't This Just Another Property Tax?"</h3>
No - and the difference is crucial. Property tax charges you more for building housing or businesses. LVT charges the same regardless of what you build, encouraging development rather than penalizing it.</p>