Land tax was one of the main issues examined by Dr Ken Henry in his review on "Australia's Future Tax System" and the review recommended its increased importance in raising revenue in Australia. The classical economists such as Smith, Ricardo and Mill recommended the imposition of a tax on land. Henry George also strongly advocated a tax on land instead of a tax on labour or capital. They also contended that such a tax was both efficient and equitable. This paper will examine the current position with land tax in Australia and the views of the early economists advocating the benefits of such a tax. The paper will then examine the recommendations contained in the Henry Tax Review and what would be required to reform this area of taxation law. The paper will also examine the initiative undertaken by the Australian Capital Territory (ACT) government in abolishing stamp duty on conveyances and imposing a land tax on all real property in the ACT. In conclusion the paper will contend that a reformed land tax is of critical importance for future governments and that it may not only raise considerable revenue but also result in reduced income tax rates for individuals and companies.