I'll add to this discussion when I have more time, but one point I'd like to make:
It can actually increase economic activity if structured as a land value tax(calculated based on the value of the land itself while excluding the value of improvements made to it(ie. a house)), because it strongly penalizes underutilization of land.
While I suppose it's not really something to worry about in today's economy, couldn't this potentially lead to rather significant real estate speculation and thus risk creating a new housing bubble?
