|
Recent studies in Australia show that land and resource values have outstripped wages
several times over, and that wages have been depressed as a consequence.
On this evidence taxes on incomes will never be enough to make up for inadequate incomes caused by the investment in land values and natural monopolies.
- Average wages have increased by little more than 1% per year over the last 30 years.
- Land values (capital gains) have soared by around 6.4 % per year to 2000 % over 50
years. [In our view this is the cause of (1) above. It will become worse with access to
cheap money. Ed.]
- Between 1910 and 1999 total land value in Australia at year 2000 prices, went from approximately $37,200 million to approx $850,000 million, at an average
compound rate of 3.62%.
Land value per capita went from approximately $8,650 to approx $45,000 at
an average compound rate of 2.06%.
- Between 1907 and 1999 the arbitrated minimum wage at Year 2000 prices, went from approx $200 to $400, at an average compound rate of 1.19%.
- Direct and indirect taxes, and compliance costs take 53% of the average wage.
- Resource Rentals, if taken for Revenue would be more than enough to match current Budgets.
- Average household disposable income would rise by 56% even before the incentive or stimulus of penalty derived from the re-incidence.
Recent studies by the Land Values Research Group in Victoria put Australia's potential
Rent from land sites at $90 billion and from resources at $60 billion; a total of $150
billion. Current total revenue is $190 billion. (In fact deadweight losses have been
estimated as high as one-third of current revenue, but even a more modest 25% would
reduce effective current revenue requirement to around $140 billion).
Since the "sector" ratio by aggregate value of sites in Australia is:
- residential 6
- commercial 2
- rural 1
the Rent revenues from each sector would then be:
- residential $60 billion
- commercial $20 billion
- rural $10 billion.
respectively. On that reckoning, current average residential Site Rents
for Australia's 7 million households would average $8,500 per annum.
As at June 2000:
|
Average house value | $175,000 |
|
Average annual household income (before taxes) | $45,000 |
|
Average household tax and compliance costs | $24,300 |
|
Average household disposable income | $20,700 |
|
Estimated land value (65% of house value) | $113,750 |
|
Estimated Site Rent (current yield of 7%) | $8,500 |
|
Average household disposable income in a Site Rent System | $37,500 |
Compare this outcome with the estimated average household disposable income (2000) of approximately $24,000. The average gain per household is $13,500 per annum or $260 per week.
[These studies, would show essentially similar results if conducted in New Zealand - Ed.]
- reproduced with the kind permission of Progress (Australia) and Geophilus magazines.
For some stunning research results, see Tony O'Brien's last paper:
the title of it
|
