Now, after making the usual unjust allowance for interest on thirty pounds for twelve years or so that had elapsed, the sale of the picture would have brought me in a profit of over seven hundred and fifty pounds, an unearned increment
to which I had no righteous claim.
It is really quite an old insight that much wealth is acquired as an "unearned increment
," with additional value being added by human effort.
The conversation overheard on the street consists of nothing but corner lots, options, homestead sections, railways, high level bridge, and "where will the provincial buildings be built?" Fortunes have been made and probably will be lost but the whole aim and object of everybody seems to be to get a share of the "unearned increment
The social liberals were strong proponents of land reform and the taxing of unearned increment
, such as increases in land values brought about by the growth of cities.
He did indeed assert 'we must make land common property', but the text also shows that he regarded ownership of the unearned increment
as the essential aspect of the right of private property in land.
The most controversial proposals, however, were for a capital gains tax on the 'unearned increment
' in the value of land created not by the landowner but by the community at large and duty on the capital value of undeveloped land.
Profit was gain without labour and as 'unearned increment
' deemed sinful (though not as sinful as money-lending at interest).
The fortunate community living on this estate will rejoice in the knowledge that the unearned increment
which may result from the rents of a population of 30,000 souls will not go to enrich any individual landowner, but will be spent in such a way as to refine the lives, ennoble the characters and exalt the minds of all who reside on the estate.'
One of them was a tax on "unearned increment
" in land (e.g.
Mill asked, "In what would they have been wronged if society had, from the beginning, reserved the right of taxing the spontaneous increase....?" An owner would not be taxed on the increase that had occurred before he became the owner, but only on the unearned increment
during his own period of ownership: "The present value of all land should be exempt from the tax," Mill wrote; "but after an interval had elapsed, during which society had increased in population and capital, a rough estimate might be made of the spontaneous increase which had accrued.