As long as land remains unused it pays no rates or taxes, whatever its immediate potential value.  But the moment it is brought into use, as soon as a house, a factory, or a railway is built upon it, or it is drained or planted—­rates and taxes, which in these days often exceed 50 per cent. of its improved value, have to be paid, without regard even to the question whether its use is successful in yielding profits or not.  Familiarity with this system, instead of breeding the contempt which it deserves, has bred a kind of passive acquiescence which is exceedingly difficult to shake.  Even such a champion of our land system as the Duke of Bedford years ago in his book, The Story of a Great Agricultural Estate, perceived the absurdity, although he was apparently blind to the remedy and to the application of it to some of his estates which are not agricultural.  He converted an ordinary arable field into a fruit garden, and discovered that his rates were promptly trebled by reason of his expenditure.  Striking, but, nevertheless, everyday examples may be found if we see how the system works out in urban districts.  If a new factory is built, rates and taxes are immediately levied on the full annual value of the building, which is a direct charge upon production, and has to be paid before a single person can be employed in the factory.  It therefore not only restricts the possibilities of employment, but has to be added to the price at which the goods can be sold.

THE LESSON OF THE SLUMS

Or take the illustration of a slum area.  Each tumble-down tenement is rated and taxed on the assessment based upon its annual rental value.  In many places in the central parts of towns the total of these assessments is less than the sum for which the whole site could be sold as a building area, nevertheless if all the tenements fall or are pulled down the site may remain vacant for years and no rates or taxes are paid.  But if substantial and decent buildings are erected on the site, immediately the assessment is raised to their full annual value.  The individual or public body that has cleared away the slum and erected something decent in its place is thus immediately punished for doing so, with the result that such a thing is seldom done except at the public expense.  The remedy for all these absurdities is quite a simple one.  No one disputes that the sums necessary for municipal and imperial taxation have got to be provided.  The question is, in so far as they are to be raised from lands and buildings, how can they be assessed most fairly and with the least injury to trade and commerce?  They should be assessed upon the value of land which is not due to any effort of the owner or occupier; they should not be assessed upon nor increased because of any buildings which he may have erected or any improvements which he may have carried out.