by Walt Rybeck


Jamaica’s early economy was based on agriculture. Discovery in 1942 of vast quantities of bauxite, the ore used to manufacture aluminum, soon brought mining into prominence. More recently, tourism has burgeoned.

In 1943, two decades before Jamaica became an independent member of the British Commonwealth, Jamaica was faced with high unemployment, lack of development and vast tracts of valuable but unused sites. A commission from Britain was called on to explore ways to deal with these problems.

After considerable study, this commission urged the colony to change its property tax from one based on the capital value of the land and buildings to one based solely on the value of the land. The International Bank for Reconstruction and Development in 1952 endorsed this proposal. A few years later, when Norman Manley’s colonial administration took office, Manley liked the idea and asked the United Nations for technical help in assessing the island’s land. The UN invited Australian valuation specialists who helped manage appraisals for their country’s land tax to set the stage for Jamaica’s actual land value tax law, enacted in 1957.

To explain land value tax (LVT) to the people and the parliament, Manley pointed out that the existing property tax on buildings was a heavy tax on labor, on the people “who do more and more with their land,” while those “who do nothing with the land” pay little if any tax. He said LVT, instead of taxing “the labor of man on the land” would tax “the value put into the land by the community.” He stressed that this was a fairer way to raise revenue and said it was needed to spur development. LVT became a popular idea among Jamaica's leaders.

Jamaica, the third largest island in the Caribbean, is divided into 13 parishes. The land tax was begun in two parishes, and was finally implemented throughout the nation in 1977. An advantage of LVT over the traditional property tax is that a relatively few officials can learn land appraisal techniques and then complete the valuations for all parcels. The newly trained Jamaican valuers were able to appraise the land with much more accuracy and in a much shorter time than if they had had to appraise buildings and other improvements on the land.

In St. Catherine and St. Ann parishes, the first two to adopt LVT, it was found that there were many small parcels—over 30 thousand—with land of negligible value, worth 100 Jamaican pounds or less. These were all charged a flat minimal fee of pennies, simply to keep track of ownership titles. On the other extreme were properties worth 20,000 to a million pounds, held by only 78 landlords. The other 10 thousand owners in between the very poor and the very rich, had parcels of modest value. So it was decided to use progressive tax rates, the higher the land value the greater the tax rates.

Because LVT meant lower property taxes for most home owners and businesses, it has remained popular. An official said a few years ago that it would be “political suicide” to try to change it. However, it is a relatively small component of the overall tax base of Jamaica and its full potential has not been realized.

Initially it made sense to keep the total revenue from the land tax the same as had been raised from the old property tax. The intent was to gradually increase the rates to make LVT a more important revenue producer. When Michael Manley (son of Norman Manley) became prime minister, he gave lip service to the land tax. However, he relied mainly on income taxes to raise over 95 percent of the nation’s revenue. LVT remains, but only barely.

Even bauxite, instead of being taxed by LVT, that is, by the value of the ore in the ground, is being taxed on the value of the mineral extracted, making it less competitive than ores elsewhere in the world.


Jamaica demonstrated that many officials and citizens of a poor Caribbean nation understood the benefits of a land value tax (LVT) and were empowered to take the necessary steps to implement such a tax.

Initially political leadership articulated the benefits of the policy in a clear and direct way to the citizens. Community leaders actively supported its implementation.

Jamaican valuers were able to appraise the land with much more accuracy and in a much shorter time than if they had had to appraise buildings and other improvements on the land.


The potential of LVT to stimulate better land use, reduce the large holdings of idle land, and stimulate both production and employment, has not been realized. Before the land value tax /capture rates could be increased to make LVT a more important revenue producer, a change in political leadership (in this case from father to son) made income tax rather than LVT the major source of government revenue.

Despite a good beginning, apparently there was insufficient “grounding” of the concept and practice of LVT in the minds of the people and the political leadership for it to sustain a fuller implementation.


Currently local officials say they have to go hat in hand to the federal government to finance most of their public works and public services. If officials and community leaders were to revisit the concept and practice of LVT they could work to replace the high income taxes that are stifling production while simultaneously reaping more revenue from LVT. This would properly harness incentives to put Jamaica back on the road toward economic prosperity.


The introduction of LVT in Jamaica followed years of careful analysis by some of the world’s leading taxation specialists. If the current generation of officials and community leaders fail to focus on that history and understand the philosophical, ethical, political and economic underpinnings of that history, Jamaica’s potential for leading the Caribbean nations out of widespread poverty, unemployment and exploitation may be lost.