I reply to David first and then to Roger. Suppose that A owns a piece of land that he values at $100. Entrepreneur B appraises the land and his unique entrepreneurial knowledge, which he has produced, leads him to appraise it at $200. The present value of the future income he expects after buying the land and diverting its use is $200. He is able to buy the land at $101 because A is not an entrepreneur. A year later, C's entrepreneurial knowledge leads her to appraise the land at $300. B's appraisal has not changed. C buys the land at $201 because B does not recognize the higher appraised value. Now B has enjoyed a capital gain of $100. $99 of that was due to his superior appraisal. $1 was due to his ownership of the land. Now if you threaten to tax all of the $1, you will take away the incentive to sell. If you tax the $99, you will take away the incentive to produce a superior entrepreneurial appraisal. If you tax a per cent, you will reduce the incentive to the degree that you tax. A low per cent tax will reduce the incentive to a low degree a high per cent tax will reduce the incentive to a high degree. The price of "the prime site in Oxford Street" is the consequence of the accumulated appraisals and reappraisals of countless individuals over a period of hundreds of years. No doubt there were lucky landowners who gained windfalls at particular times from those appraisals and the actions that followed. But we cannot tax them today. We can only tax their heirs, if we can find them and if they have anything left to tax. I cannot think of any way to tax the future windfall gainers without also taxing the entrepreneurship that causes the gains to occur and, at the same time, taxing the entrepreneurship that gives consumers the additional surplus because the prime site is used in the best way that the competing entrepreneurs know. I understand Roger's struggle, I think. One way to approach the issue is to make a concrete proposal and then to consider the likely effects of adopting it. What specific tax would George promote, as you see it? Pat Gunning