Loved this article (especially placing Land Value Taxation first)
Strongly agree, in general, except I'd put VAT lower on the list than you. I'm a big fan of Pigouvian taxes, especially when they take into account variable pricing (congestion pricing, smart parking meters, etc)
I would also add severance taxes, which are slightly distinct from Pigouvian tax, in that they don't tax an activity which is intrinsically harmful to the environment, etc. Rather, they tax the act of taking something out of our commons.
ie. when you extract copper from the ground, you are reducing the value of the land (which belongs to us all). So you need to pay something back, or else LVT would just encourage rapid mining in order to whittle down the LVT quicker.
One of the unspoken costs of VAT is that it imposes all the collection overhead upon businesses. And this is a bigger burden for small businesses than large businesses.
Pigou's intellectual opponent Ronald Coase made this very wise argument:
--
"He notes that government measures relating to the market (sales taxes, rationing, price controls) tend to increase the size of firms, since firms internally would not be subject to such transaction costs. Thus, Coase defines the firm as "the system of relationships which comes into existence when the direction of resources is dependent on the entrepreneur." We can therefore think of a firm as getting larger or smaller based on whether the entrepreneur organises more or fewer transactions."
https://en.wikipedia.org/wiki/Theory_of_the_firm
Biting the hand that feeds IT
