Better Dwell Idea: The Land Tax

I know that Great New Ideas are a dime a dozen on these boards, but that being said, here's my pitch.

So, the Lindens just incurred a fair amount of wrath and resentment by changing several policies intending to limit in-world money supply. I don't think I need to go into these in too much detail, but to recap, their three major changes were to cut stipends in half, charge $25 for ratings, and to permanently halt event subsidies. These changes will likely work for the Lindens in the short run; what kind of social changes they'll induce is something that is yet do be determined, and more importantly, something for another post.

What I want to talk about here is Dwell, now called Traffic. Up to now, the Lindens have distributed a fixed amount of Traffic money on a daily basis; $48,000 so far as I know, though it may be higher now. The money is distributed to landowners based on a system designed to reward popular locations at the same time minimizing the ability to "game" the system. The distribution methods aren't perfect, but they seem, on the whole, to work.

The problem, then, isn't how the money is given out, but the amount of money given. $48,000, or whatever the current amount is, is a LOT of money to pour into the economy on a daily basis. It's WAY more than was ever paid out in event subsidies. This, especially with stipends now halved, is one of the largest infusions of cash into the SL economy.

What bothers me is that the Lindens have taken away or diminished two relatively egalitarian ways of making money, and placed proportionally greater importance on Traffic, which typically benefits a plutocratic group of the game's largest landowners.

There's another way to do this. It's simple, and would keep money supply constant, while allowing for continued support of events, which I feel are one of the greatest aspects of being in SL.

Here it goes: generate Traffic money from a land tax.

Yes, you heard me right. A tax. Not a big tax, mind you, but a tax. And here's how it would work.

Every sale of land would be assessed a 5% tax . In other words, if I sell you my land for $10,000, I'd recieve $9,500, with $500 going into taxes. This money would be placed into a pool, and at the end of the day be distributed as Traffic bonuses. This would be a democratic way of supporting people's clubs and popular sites, and furthermore, it wouldn't cost the Lindens a dime. Landowners would, in effect, be paying into the very system that pays them.

Not only would this system replace one of the largest artificial subsidies in the game, it would also change a static and rather arbitrary payout amount into one that reflects real economic conditions. It would also place a minimal burden on the game's less wealthy residents, since, clearly, they're not buying and selling a whole lot of land.

So, what do you think? It sounds like a simple idea to me, and one that would free up cash for our beloved stipends and event support. Why tolerate changes that increasingly benefit the rich? Up with the Land Tax instead!

We've done the tax-thing before, and it was killed.

I personally feel the system is fine as-is. Event support has not stopped, but gone private. There are a few people out there who will sponsor events - like Anshe - so it's not as though sponsored events are dead.

I just don't see the tax as a 'fix' for anything.

Hummus... also, I wanted to point out a common error in the information regarding stipends. You mention that stipends were cut in half - which is not true. What was halved was the *bonus* portion of the stipend, not the entire stipend.

hehehe so "rich people" wouldn't deal with a land tax better than others? anyway.......

we already pay land tax every month. tier fees. pretty steep considering. call it rent instead of a tax it's still the same thing. you want to hear people scream bloody murder you go ahead and put another fee on top of the monthly fees.

it's one thing to give people less free money. it's a whole other thing to put a new charge onto us.

Something along these lines might be a good idea, however:

You can't keep money supply constant in a world with a growing population and in which new sims are added on a regular basis.

Whenever Linden-owned land is sold to the public, it takes money out of the economy. Part of the dwell/traffic payments and other distributions of cash from LL to Residents is merely putting that money back into circulation.

A tax on land transactions isn't necessarily a bad idea. Two objections will be raised:

1. People who make a lot of money on land transactions will complain that they already pay RL taxes. This objection is specious, however, since the effect of a tax would be to reduce the seller's income, thus reducing RL taxes. If you sell your land for L$10,000 and pay L$500 in tax, you're only recording L$9,500 toward whatever RL taxes you're paying (if you're smart).

2. Oldbies will tell you that taxes have been proposed and rejected before. But this is also an argument that doesn't hold much water. Giving women the vote was proposed and rejected many times before it was finally accepted. I don't mean to equate the two, but that argument in itself isn't sufficient reason to drop the idea.

Whether it's a good idea or not, proposing any kind of tax would be an uphill battle and take a long time to implement and I personally feel that we're not even close to having enough data on the economy to even be able to wisely consider such a thing.

Plus, Zuzi makes a very good point.

This thread is freaking hilarious
Keep em coming!

um.....from what i've read on here i don't think land taxes are a proposed-and-rejected before thing. i'm pretty sure they were the policy originally and turned out to be a Bad Thing so they got rid of them. your analogy's going to snap but it's like they gave women the vote and we all voted to do away with men so they took the vote away again.

ps: Eggy i luv your forum avatar. much cuteness.

Uhhh.. the 'oldbies' will tell you that taxes *EXISTED* before and were repealed. They weren't just proposed and rejected. They existed - and they were a PITA, IMO.

We already pay a monthly fee for land (aka 'tax'): Land Tier Fees.

Do I have to stand in line to kill you?!

Of all things... you want to call it TAXES!!!! Call it like the fluffy bunny reverse stiptend or something!

Ok, apparently you need a tiny bit of education on what was changed, why, and why your idea isn't needed at this time.

First, stipends were not cut... the bonuses TO the stipends were cut. In addition, due to the ratings changes, the weekly ratings bonus has gone down. This reduced some people's income by around L$125 per day. However, the majority of the population (meaning everyone but the few dozen or so who were ratings whores) only lost anywhere from L$5-10 per day. Not that big of a change, really. A tiny change, in fact.

Secondly, event welfare for non-useful events was removed. This is probably the biggest of the three changes. I don't know how many events fit the welfare rules in the old system, and I don't remember the amounts you could get on welfare, but I'm guessing the amount of L$ pumped into the world daily was in the five figures range. Probably low five figures... maybe L$10,000-20,000?

Finally ratings were increased to L$25. This part you got right. Now, LL fully expected that this would have very little impact. If the price of ratings goes up, but the frequency of ratings goes down, is money really being pulled out of the system that fast? No, probably not, and LL knew that raising the price of ratings wouldn't really do much as far as affecting the economy (except affecting weekly bonuses). So why'd they do it? Because it was a handy and easy way of getting people to start thinking of ratings as something MEANINGFUL rather than a cheap gold star sticker you slap on someone. Since the change was "economic" in nature (a price change) it was just easy to slip it in with the other two changes.

All that said, lets take a look at your proposal...

You're essentially suggesting that rather than money getting pumped into the system, we shut the flow off completely and start recylcing what we have in the system.

You even admit that L$48,000 is a lot of money to pump into the system daily.

Has it occured to you that maybe that much flow is NEEDED? The very economy of SL actually depends on that large cash flow getting shoved into the system daily. The three changes they made to the system were TINY changes, and that's all we needed. Tiny changes. Shutting off Traffic subsidies would be a MAJOR change that could easily send the entire economy into a deadly tailspin of stagnation.

So no, that's not a bright idea.

Read my lips: "No new taxes!"

*giggles*

OMG LAND TAXES NOT AGAIN NOOOOOOOOOOOOOOOOOOO!!!!!!!!!!!!!!!!!!!

No no no no no no no no no.

No.

NONONO.

No.

Now I need some aspirin.

Or better yet a hot toddy at the irish room round the cornah.

Back in an hour.

Bring back the Light Tax!

Other than that, no taxes.

Noone listen to the man behind the curtain. There is nothing to see here... move along.

how about an age tax? L$1 per day for each month you've been in sl. stick that in your pipe and smoke it grandpa. yeah, not feeling so feted now huh? that's what i thought.......

Go back and read NWN concerning the tax revolt...You're missing a whole period of SL history with your 'new' idea...

Let me see if I have this right.. You want land owners to have to pay twice, so event hosts will not have to pay anything at all? Is that about right? Get the land owners in $US on tier fees, then get them again in L$ by way of a tax?

No, but thanks.

I know! An event tax!

(Kidding! KIDDING! Seriously, it's a stupid idea. No, don't run with it. No. Don't. Seriously.)

I may be wrong (or at least, under-educated), but I'm glad I posted here, just so I could get this reponse. Poor little analogy. Had it been groomed better when it was a child it wouldn't now be suffering so.

Ack, socialism rearing its ugly head again, enough of that, no taxes, especially no taxation without representation.

Now, let's think how you could really make dwell a great system.

-- Increase the amount. Why be stingy?
--Let players control their dwell/traffic purse directly, without this arcane, ridiculous, incomprehensible dwell formula that changes every day
--With more direct purchase dollars, players immediately have the power to visit a build and award dollars through clicks or merely by being there for 5 minutes, as they draw down their dwell purse
--Hosts of build see their purses fill up accordingly, it's fast, democratic, and has more incentive
--Harder to game because each person is an oversight of their purse
--Sure, people will Shanghai you with tps but you can control how your dwell is spending by leaving before the timer of 5 minutes goes off
--Instead of divind dwell stupidly and giving people no comprehension of what goes on, let each visit have a clearly distinct dollar leaving and going into accounts. Or half point. But something visible.
--No more long arguments about where the dwell went, what it is, how you figure it. And a democratic way for people to vote with their feet for good builds, way, way better than the subsidies of grants from on high.

subsidies tend to promote things.
- subsidies are not entitlements.
taxes tend to discourage things.
the kind of taxes you propose tend to be regressive.

but before going there too much in detail, your premise may be wrong.



is the problem a problem of distribution?
is the problem a problem of an every growing money supply?
is the problem a problem of inflation or deflation?

before framing solutions might be worthwhile to understand what the problem is.

the goals of ll are not necessarily the same as the goals of the residents of sl as individuals, but may be aligned with the goals of the residents of sl as a collective.

Good god, I had no idea L48,000 was created each day in the form of traffic payments.

Thats a lot of money to be entering the economy each day! L$17,520,000 per year! Wow!

you're talking about a sales tax, not a land tax.

we already pay land taxes every month. we call them tier fees; but they're property taxes. in fact, they add up, with my annual preimium payment, to nearly equal my real life land taxes. granted alabama has by far the lowest land assessment tax rates in the country. but still, to add a second land related sales tax will mostly take money out of newbie pockets and redistribute it to more established players that own a lot of land.

Go down to a realestate agent and ask them to rent 65536 m^2 of land for 196 dollars a month