Betterment levy is a tax imposed on a landowner when the local authority changes existing restrictions on the land in a way that increases its value. For example, if I own an empty lot where only two stories are permitted, and the municipality decides that from now on, four stories can be built on the lot. It's clear the lot's value will increase, and half of the lot's value increase will be paid to the municipality as a betterment levy. The payment is due upon the sale of the property. Note the difference compared to capital gains tax.Betterment tax refers to an increase in value regardless of the reason, while betterment levy refers only to an increase in value resulting from an initiative by the local authority. In the betterment levy, those whose land value has increased due to municipal activity are used to compensate landowners whose land value has been harmed as a result of other decisions and who need compensation, to finance the planning of the changes that led to the betterment, and for other purposes permitted by law.