A land value tax is a charge on the unimproved rental value of a location — what the bare land is worth because of its surroundings, not the buildings or improvements on it.
Because the supply of land is fixed, the tax can’t be avoided by producing less, and unlike most costs it can’t be passed on to tenants. It rewards putting good locations to use and penalizes holding them idle. Compare it with an ordinary ground rent, and see the idea in action in Where Does Wealth Go?.