The Harberger Tax, also known as Common Ownership Self-assessed Tax (COST), is a type of property tax that aims to improve societal welfare by optimising for both investment and allocative efficiency of private property. It proposes a new kind of "partial ownership", halfway between private ownership and common ownership. The tax is implemented by two mechanisms:
Owners periodically self-assess their property and pay tax on its value. Others are able to purchase the property from the owner at the taxed price at any time, forcing a sale.
First proposed by American economist Arnold Harberger, it was further popularised in Glen Weyl and Eric Posner's book Radical Markets: Uprooting Capitalism and Democracy for a Just Society.
A similar idea was previously proposed by Sun Yat-sen in 1905, where the government is the entity that can purchase the property from the landowners if the self-assessed price is too low.
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