The land value tax is an idea that has gained some currency in some respectable Christian Democratic and Distributist circles, and thus it is necessary to do the hard work of subjecting the idea to some evaluation. The zeal of its adherents combined with the reluctance of others to wade into the murky waters of numerical abstraction has permitted the idea to proceed with a level of acquiescence to which it is not entitled.
The idea was popularized, though not originated, by Henry George, the author of Progress and Poverty, wherein he made the claim that to “to affirm that a man can rightfully claim exclusive ownership in his own labor when embodied in material things, is to deny that any one can rightfully claim exclusive ownership in land.”  His reasoning was that land is a given in nature, and is the result of no one’s labor. Thus, he said, the “equal right of all men to the use of land is as clear as their equal right to breathe the air—it is a right proclaimed by the fact of their existence.” It followed from this observation that land should become common property. He wrote:
“There is but one way to remove an evil—and that is to remove its cause. Poverty deepens as wealth increases, and wages are forced down while productive power grows, because land, which is the source of all wealth and the field of all labor, is monopolized. To extirpate poverty, to make wages what justice commands they should be, the full earnings of the laborer, we must therefore substitute for the individual ownership of land a common ownership. Nothing else will go to the cause of the evil—in nothing else is there the slightest hope.”
Notwithstanding this, George did not propose confiscation of land.
“I do not propose either to purchase or to confiscate private property in land. The first would be unjust; the second, needless. Let the individuals who now hold it still retain, if they want to, possession of what they are pleased to call their land. Let them continue to call it their land. Let them buy and sell, and bequeath and devise it. We may safely leave them the shell, if we take the kernel. It is not necessary to confiscate land; it is only necessary to confiscate rent.”
When George referred to “rent” he didn’t mean that as the term is commonly understood, as the actual and total amounts paid over by a lessee. He explained it this way:
“In common speech, we apply the word rent to payments for the use of buildings, machinery, fixtures, etc., as well as to payments for the use of land or other natural capabilities; and in speaking of the rent of a house or the rent of a farm, we do not separate the price for the use of the improvements from the price for the use of the bare land. But in the economic meaning of rent, payments for the use of any of the products of human exertion are excluded, and of the lumped payments for the use of houses, farms, etc., only that part is rent which constitutes the consideration for the use of the land—that part paid for the use of buildings or other improvements being properly interest, as it is a consideration for the use of capital.”
For George, rent, properly speaking, constitutes only those amounts that are paid for the use of the land itself, exclusive of any improvements on it. But in George’s understanding of rent, it is not necessary that any amounts be paid over at all, or that there even be someone in the position of a renter.
“In common speech we speak of rent only when owner and user are distinct persons. But in the economic sense there is also rent where the same person is both owner and user. Where owner and user are thus the same person, whatever part of his income he might obtain by letting the land to another is rent, while the return for his labor and capital are that part of his income which they would yield him did he hire instead of owning the land.”
This aspect of George’s definition of rent is critical. When he spoke of confiscation of rent, he was not referring only to a portion of amounts actually received by a landowner, but a portion of the amount a landowner could receive if he rented his land to another, that portion representing the value of the land itself, exclusive of improvements. The confiscation of this “rent,” as defined by George, is what has come to be known as the land value tax.
George proposed that this tax would be the exclusive mode of taxation, and would restore balance to what he deemed the unjust circumstance of private land ownership. As he put it,
“In this way the State may become the universal landlord without calling herself so, and without assuming a single new function. In form, the ownership of land would remain just as now. No owner of land need be dispossessed, and no restriction need be placed upon the amount of land any one could hold. For, rent being taken by the State in taxes, land, no matter in whose name it stood, or in what parcels it was held, would be really common property, and every member of the community would participate in the advantages of its ownership.”
George felt that this tax would have almost magical salutary effects.
“What I, therefore, propose, as the simple yet sovereign remedy, which will raise wages, increase the earnings of capital, extirpate pauperism, abolish poverty, give remunerative employment to whoever wishes it, afford free scope to human powers, lessen crime, elevate morals, and taste, and intelligence, purify government and carry civilization to yet nobler heights, is—to appropriate rent by taxation.”
To George’s credit, he submitted his theory to the ultimate level of arbitration. “If private property in land be just,” he said, “then is the remedy I propose a false one; if, on the contrary, private property in land be unjust, then is this remedy the true one.” But Pope Leo XIII showed that property in land is indeed just in his encyclical Rerum Novarum.  He wrote,
“Truly, that which is required for the preservation of life, and for life’s well-being, is produced in great abundance from the soil, but not until man has brought it into cultivation and expended upon it his solicitude and skill. Now, when man thus turns the activity of his mind and the strength of his body toward procuring the fruits of nature, by such act he makes his own that portion of nature’s field which he cultivates - that portion on which he leaves, as it were, the impress of his personality; and it cannot but be just that he should possess that portion as his very own, and have a right to hold it without any one being justified in violating that right.
“So strong and convincing are these arguments that it seems amazing that some should now be setting up anew certain obsolete opinions in opposition to what is here laid down. They assert that it is right for private persons to have the use of the soil and its various fruits, but that it is unjust for any one to possess outright either the land on which he has built or the estate which he has brought under cultivation. But those who deny these rights do not perceive that they are defrauding man of what his own labor has produced. For the soil which is tilled and cultivated with toil and skill utterly changes its condition; it was wild before, now it is fruitful; was barren, but now brings forth in abundance. That which has thus altered and improved the land becomes so truly part of itself as to be in great measure indistinguishable and inseparable from it. Is it just that the fruit of a man’s own sweat and labor should be possessed and enjoyed by any one else? As effects follow their cause, so is it just and right that the results of labor should belong to those who have bestowed their labor.”
Pope Leo XIII thus rejected the notion espoused by George that there is an injustice involved in the private ownership of land. Indeed he held that it would be an injustice to deprive people of it. And he based that on the very ground that George held was the only legitimate basis for owning property: labor. Land worked on is land that is humanly transformed, and this is the legitimate and original basis for the acquisition of property, as George would be compelled to agree.
This was not a simple misunderstanding, but a fundamental difference between the two. Henry George held that private property in land was an injustice, which he sought to remedy through taxing rental land values. But Leo XIII said that ownership of land was a right, and that the injustice would lie in denying that right. George understood how diametrically opposed the two views were, and, after the publication of Rerum Novarum, he wrote to the Holy Father with the observation about the encyclical that “its most strikingly pronounced condemnations are directed against a theory which we who hold it know to be deserving of your support….” 
Of course, there can be no question about the status Rerum Novarum should hold in the mind of every Catholic who would be consistent with the social doctrine of the Church. Pope Pius later wrote that “it cannot be rash to say that Leo’s Encyclical has proved itself the Magna Charta upon which all Christian activity in the social field ought to be based, as on a foundation. And those who would seem to hold in little esteem this Papal Encyclical and its commemoration either blaspheme what they know not, or understand nothing of what they are only superficially acquainted with, or if they do understand convict themselves formally of injustice and ingratitude.” 
Now if Henry George’s idea about private ownership of land cannot be sustained, then neither can the tax he proposed. His tax was designed as a kind of reparation to the community for the private holding of land that rightfully, to his mind, belonged to everybody. But if there is no injustice in the private ownership of land, there are no reparations to be made. Moreover, if the land value tax is not restoring balance in response to an antecedent injustice, it is doubtful that it could have effects as if it was doing so.
Still it might be argued that a land value tax would be a good idea apart from George’s ideas about private property in land. And it cannot be argued that a real property tax of any kind isn’t the easiest to enforce, since land cannot be transferred to an overseas bank account, and its seizure is a relatively simple matter in the event of delinquency or tax evasion. But when it comes to a tax policy, ease of enforcement should take second place to fairness, and there is good reason to doubt the fairness of the land value tax.
The fact is that the land value tax is a real property tax, regardless of the method of valuation. When people pay this tax it will be of no consequence to them what theory is behind the assessment. They will pay with money either way, and there will be consequences that theory will be powerless to change.
There are those who believe in progressive tax rates, and there are others who believe that a flat tax would be fairer. But there are few who would argue that those with low incomes should pay a higher percentage of income than those who make more money. Property taxes, however, accomplish exactly that.
In 2015 the Institute on Taxation and Policy published its fifth Who Pays? report , which contains a section on property taxes. The Institute’s analysis shows property taxes to be regressive for these reasons:
“• For average families, a home represents the lion’s share of their total wealth. At high income levels, however, homes are only a small share of total wealth. Because the property tax applies mainly to homes and exempts most other forms of wealth, the tax applies to most of the wealth of middle-income families and a smaller share of the wealth of high-income families.
“• For homeowners, home values as a share of income tend to decline at higher incomes. Thus, a typical middle-income family’s home might be worth three times as much as the family’s annual income, while a rich person’s home might be valued at one-and-a-half times his or her annual income or less.
“• Renters do not escape property taxes. A portion of the property tax on rental property is passed through to renters in the form of higher rent — and these taxes represent a much larger share of income for poor families than for the wealthy. This adds to the regressivity of the property tax.”
In sum, with a land value tax, as with any real property tax, those with lower incomes will pay a higher share of their wealth than those with higher incomes. It is a tax that will hit the poor and middle class hardest, and, simply put, be a benefit for the rich. If the tax was imposed only on those who were actually collecting rent, it would be a different proposal. But, by design, it reaches the rental value of land, considered as unimproved, regardless of whether an income is actually being derived from the property. The unfairness is palpable, and it is easy to see how it would drive real property ownership (or occupation as a follower of Henry George would have it) into the hands of those wealthy enough to pay the tax.
Regardless of the basis or theory behind any tax proposal, taxes must be paid with money. Basic fairness requires that taxes be designed to be imposed on those with the money to pay them. The land value tax proposal fails this test, which is unsurprising, since it is based in an understanding of real property ownership that is contrary to Catholic social teaching.