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New York passes pied-a-terre tax

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Re: New York passes pied-a-terre tax

#271

Post by cyberax »

blactuary wrote: post #148
Aurornis wrote: post #95

Earlier quoted context omitted.

> If it turns out the uber-rich don't mind paying and this becomes a cash cow for the city, that creates incentives for the city to cater to them and try and get more uber-rich people to have second homes in the city. The tax is reasonably small enough that I wouldn't expect a lot of wealthy people from divesting from their properties, but it's probably going to make them think twice about buying new properties. That…

The goal of this isn't simply to raise revenue, it's also to discourage parking money in empty properties when it's one of the most expensive cities to live in and doesn't have enough housing

Expensive cities will never have enough housing. The cure is to discourage investment in them and force it into less dense cities.

Re: New York passes pied-a-terre tax

#272

Post by electrondood »

I support this. The purpose of a home is for people who live in the area to live in, not to be a speculative investment.

This is part of the reason we have a housing shortage in the US: 20% of available homes are purchased by investors, which squeezes the supply.

Airbnb has made this worse. There are areas near me where during the COVID ZIRP, people snatched up like 70% of the homes to turn into rentals. Those places are now ghost towns, unless it's Memorial Day weekend.

Re: New York passes pied-a-terre tax

#273

Post by sporadicism »

SoftTalker wrote: post #207
gruez wrote: post #167

Earlier quoted context omitted.

>I would disagree, I think income taxes and inheritance taxes are morally wrong. So what taxes aren't "morally wrong"?

Property taxes on real property or possibly land value tax (it's a limited resource, at least in places where people want to live, and requires a lot of public infrastructure to support its value there). Tariffs, various usage taxes and fees. Need a mechanism to address the regressiveness of some of this but that's an implementation detail.

How is dynastic wealth not immoral?

Re: New York passes pied-a-terre tax

#274

Post by comrade1234 »

Interesting system to compare here in Switzerland. They've never had a property tax. However they did have a tax where they calculate the putative rent you could get for your property and tax you on that income (that you don't really have). So basically a property tax.

But they just repealed that system so no more property tax but you can also no longer deduct mortgage interest from your taxes. So now the system favors people that don't have loans.

That with laws against foreigners buying property (most of Switzerland - not in some economically under devised areas though) the hope is the cost of housing will go down.

Re: New York passes pied-a-terre tax

#275

Post by ceejayoz »

technothrasher wrote: post #255
Manuel_D wrote: post #236

Earlier quoted context omitted.

In the US, the inheritance taxes don't kick in until $15M ($30M for married couples). Even at 2 years old, a child can inherit more money than most people will make in their lifetime before a dime is paid to the IRS.

Federal inheritance taxes. There are also state inheritance taxes in many states. NY, for example, kicks in at ~$7M. MA kicks in at $2M.

> NY, for example, kicks in at ~$7M.

Won't someone think of the children? The very wealthy children paying a 3% marginal tax rate on some of their multi-million dollar inheritance?

Re: New York passes pied-a-terre tax

#277

Post by gruez »

OkayPhysicist wrote: post #230
gruez wrote: post #167

Earlier quoted context omitted.

>I would disagree, I think income taxes and inheritance taxes are morally wrong. So what taxes aren't "morally wrong"?

Their take on inheritance taxes is insane, but I tend to agree that income taxes are immoral. Corporations get taxed on profits: If OkayPhysicist, Inc. spends $200 to make $300, it would be taxed some fraction of $100. Individuals, on the other hand, get taxed on revenue. It doesn't matter if it costs me $4000 in rent, groceries, transportation, etc., to make $6000, I'm getting taxed on that full $6000. Capital gains…

>It doesn't matter if it costs me $4000 in rent, groceries, transportation, etc., to make $6000, I'm getting taxed on that full $6000.

So if I spend $5000 on groceries because I'm eating wagyu steak and lobster everyday, is that a fair "expense" too? You might retort that's obviously a luxury and there should be some baseline that's tax free, but then you're just describing the standard deduction.

>but as long as the value of investment is positive, that is, outpacing inflation, it makes zero sense to let your money languish in a Scrooge McDuck pile rather than get some value out of it.

...or they take their money elsewhere instead.

Re: New York passes pied-a-terre tax

#278

Post by kjshsh123 »

ceejayoz wrote: post #239
SoftTalker wrote: post #224

Earlier quoted context omitted.

So if you're spending your inheritance living the high life, that economic activity benefits a lot of other people. Still a net positive in my view. I get the political power concern, and money = power at a certain point. But I'd rather work on getting money out of politics than putting limits on what people can decide will happen to their assets after they die.

Sure, and rape helps the therapy industry. https://en.wikipedia.org/wiki/Parable_of_the_broken_window

Bastiat was opposed to inheritance taxes. He wrote about this in Economic Harmonies. I think he'd call the connection you're trying to make a stretch

Re: New York passes pied-a-terre tax

#279

Post by apparent »

burlesona wrote: post #22

Property tax is the workable wealth tax. There's no such thing as a perfect policy, but in the context of NYC this seems worth trying. I'll be interested to see if it helps create some liquidity in the housing market (the goal), or if it only functions as revenue source. One wrinkle I haven't heard much discussion of -- cities respond to incentives too. NYC is a global destination for the mega wealthy. If it turns ou…

> helps create some liquidity in the housing market (the goal)

Is that the stated goal? I thought the goal was to generate revenue from the tax. It's true that triggering sales will create a one-time boost in sales-related taxes, but that's just temporary.

Re: New York passes pied-a-terre tax

#280

Post by orangecat »

kelseyfrog wrote: post #158
SoftTalker wrote: post #135

Earlier quoted context omitted.

I would disagree, I think income taxes and inheritance taxes are morally wrong. Earning money to support oneself and family instead of relying on public largesse should not be taxed. Passing the fruits of a lifetime of work to ones heirs so they can continue do productive work instead of relying on public largesse should not be taxed.

And I think that inheritance, while a natural desire, is morally wrong. It's an example that desires aren't always congruent with morality. People will go to great lengths to justify their conclusion.

Are gifts morally wrong? If I'm near death is it wrong for to give my assets to my children beforehand, or does it only become immoral if done via a will?
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