The ABC of taxation

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Monograph

Identifikator:: 1010741608

URN:: urn:nbn:de:zbw-retromon-21094

Document type:: Monograph

Author:: Fillebrown, Charles Bowdoin

Title:: The ABC of taxation

Edition:: Fourth edition specially revised

Place of publication:: Garden City, New York

Publisher:: Doubleday, Page & Company

Year of publication:: 1916

Scope:: 1 Online-Ressource (236 Seiten)

Digitisation:: 2018

Collection:: Economics Books

Usage license:: Get license information via the feedback formular.

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Document type:: Monograph

Structure type:: Chapter

Title:: Part I. The three legs of the Tripos

Collection:: Economics Books

VALUE OF LAND AN UNTAXED VALUE 43 that fixes the price of land. Economic rent is the initial and governing factor from which all calculations must proceed. second: the house Proposition 6. — The lot having been acquired, let it he supposed that you are in need of a house, and that such a house as you want would cost to build $6,000, or, in interest, $300 a year, the same as the annual cost of the land. (a) You will observe at once that the problem of the house is quite different from that of the land. The cost of acquiring land depends primarily upon its rent. Conversely, the rent of a house depends primarily upon its cost. Builders will not build houses unless they can get interest on the cost of construction. Competition among builders will not allow one builder normally to get more than interest °n cost of construction. Proposition 7.— If such a house were free of tax, but mortgaged for $2,000, it would cost you to buy only I4.000, and it would cost you to use, as in case of the land, interest on purchase price (4,000 at 5 per cent) I200, plus interest on mortgage ($2,000 at 5 per cent) 1100, making $300 as before. (a) The mortgage upon a house, like that upon land, will add nothing to the cost of the house for use. Proposition 8 — But you find that such a house is subject also to a tax of 1100, which you will have to pay l n addition to the above $300, interest on purchase and mortgage, making the house cost you for use altogether $400, instead of $300 a year, or $100 more on account °f the tax.

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