ABSTRACT
A property tax on the land will decrease the return to the land by the dollar amount of property tax. An increase in the property tax increases the numerator of the slope; the budget line becomes more steep. The difference between new and old taxes is equal to the difference in the dollar amount of the tax. The Henry George principle on passing the cost of taxes 100 percent back onto present landowners holds for the open city when taxes are a percentage of present market value and where the initial tax is zero. The effect of the property tax upon land values has long been an issue concerning scholars and practitioners of public finance. Henry George campaigned quite successfully for the "single tax movement," where the property tax would return to the community exactly the value that land received because of the community.
