> "That kind of restriction is easy to game, and creates perverse incentives. Imagine a billionaire with an enormous house: if they start renting out half of it to someone else, suddenly they have to pay more taxes? That's not right."

How is that creating a perverse incentive? If someone seeks to transform their primary residence from somewhere they live to somewhere they make money, then what's the problem in taxing them?

Also, with regards to the rules of the proposed tax exemption, quoting jrs235... "*2b and only .25 acres of land would be exempt. (Of some other generally agreed amount)""

That distorts the incentives by encouraging everyone to use the full exempt size. Why not just give everyone a fixed amount of money to spend as they wish? That way people who want a substantial house can spend it on their land tax, and people who have better uses for it can spend it on those instead.

The perverse incentive is: the billionaire would be wasting less space for himself and sharing it with other people---but the tax system would discourage that.

Based on the relatively small number of billionaires/rich people in the world, that's a compromise I'm willing to make. If the rich want to house the poor they can do so through a charitable foundation.

Furthermore, as has been pointed out already, we could make it so that only properties that sit within a predetermined land mass size would be exempt from tax.

Why go by size and not by value? Someone having a huge estate in the middle of nowhere is not a problem, vs occupying the same amount of space (or even a much smaller, but still large one) in the city centre is.

Value is open to fluctuations, size is not.

A large estate in the middle of nowhere is still potentially wasteful. For example, could that land not be used for farming or wildlife? How many bathrooms does one person need?