Urban development and control on urban land rents

One of the main problems today in urban development is that of finding the necessary financial resources at a time of profound crisis of public, national and local finances. The argument put forward in this paper is that this is possible to a large extent through a rebalancing of the surplus values of urban transformation between the public and private sectors, in favour of the former. Cities—the large and medium-large ones with their international projection and their resources of knowledge and creativity, and those of smaller size with their cultural, relational and environmental resources—assured, at least until the onset of the 2008 global crisis, the high, if not extremely high, profitability of urban transformation processes in the form of rents, capital gains and profits for potential entrepreneurs-developers. A more balanced distribution of these surplus values is not only possible but also highly desirable, and it is advocated by a number of large international agencies and important research centres. In the paper, the legal and economic rationale for a taxation of land rents is presented, and a first comparative assessment of these fiscal policies is carried out with reference to some European countries and to Italy in particular. In this last case, the distance with respect to more courageous international practices is underlined.