One possible tax system is that of https://en.wikipedia.org/wiki/Georgism, ideas of which can be found in places such as Australia, Hong Kong, Singapore, South Africa, South Korea, and Taiwan.
I think there are numerous policies that, in principle, could fall under this idea, but one core idea of Georgism is, that the “least bad tax” is one on land. Fundamentally, Georgists believe, you may own what you have produced, but everything that’s “natural” is equally there for everybody. So nobody truly owns land - only what might be built upon it.
Check the linked Wikipedia page for details (It’s long but I think skimming it will give you an idea), but potential benefits are numerous. Just one quote:
Milton Friedman described Henry George’s tax on unimproved value of land as the “least bad tax”, since unlike other taxes, it would not impose an excess burden on economic activity (leading to zero or even negative “deadweight loss”); hence, a replacement of other more distortionary taxes with a land value tax would improve economic welfare.
This kind of tax ensures, that people don’t benefit from merely owning land. If they want to actually profit, they’ll have to use it. That’s the simplest basic idea. But there could be a lot of extra potential, if you dig for it.
I believe this was a mod in Democracy 3 too. I like the concept, and it could be a more equitable option over the property tax that doesn’t upset specific groups like the Retired and Middle Income as much as compared to the Wealthy. You could get rough numbers on how much land rents are worth in a given country and use that for the revenue formula, of which trends down in the long run as rent seeking becomes increasingly discouraged.
I’m not sure if just simply rent would quite capture this. As I understand it, it’s literally just the base value of the land that’s being taxed. If you build an apartment complex on top of it, that’s your beer.
This tax would generally encourage doing highly productive stuff on your land, so that land starts paying for itself (which it no longer does simply by being land you may use)
Though there presumably are variants on what does or doesn’t count for this tax.
In fact, the Georgist notion of “Land” can be quite abstract and general. It’s literally everything that’s not directly created by humans, I think. Like, it includes underground resources, oceans and other bodies of water, and even the air. - The later being especially relevant for climate change.
It also means, for instance, that landfills and waste dumps are an extremely bad idea. Those would cost you a lot of taxes with very little gain.
I understand LVT’s are more broader than that, I was putting it in the perspective of the game since calculations can only go so far. But yes, the policy could incorporate a lot of those long term effects, maybe feeding off of a new “land value” simulation that could have a number of impacts with or without the tax including reducing pollution or exacerbating a real estate bubble and vice versa.