51–60 of 620 posts
Land value taxes are even better. Property taxes provide a disincentive to making the land more productive. A land value tax would incentivize residential landowners to build more units which provides more supply and would lower rents.
In my region of northern New Hampshire, there are a lot of retired folks with houses rising from $200k-ish values to closer to $500k-ish values in the last 5-10 years. As such, there's a lot of discussion around lowering property taxes to help these retirees. In my opinion? Fuck 'em. Property taxes are a brilliant method of perfectly progressive taxation: you can always choose to live in a cheaper home. If your home…
And, thanks to Proposition 13, California has entirely removed this policy tool from consumer housing. A tremendous amount of our problems, from high rent to gridlock, can be traced back to this decision.
Early born privilege.
This community is deranged. All forms of taxation are messed up, the funds end up in grifters pockets, funding wars, or in black holes. The last place I want my money is in a politicians pocket. But this community overwhelmingly supports this concept. If a slave is taxed at 100% and an indentured servant is taxed at 20% - what does that make you?
Yes, local politics is inherently more tailored, but it's also more vulnerable to conflicts of interest. Most local town councils are controlled by an oligopoly of the loudest homeowners who will vote down anything that is perceived to impact their home prices. The people who want affordable housing are not part of the voting quorum because they do not live or own the neighborhood.
In other words, don't say the quiet part out loud!
Neighborhood a few minutes from me has an insane tax rate. It comes to $1000 a month for a $325k house. Keeps the riffraff away...and me...but they can afford their roads so...
My in-laws spend more than that but their home is worth more. They've owned it free and clear for like 20 years but they are getting out this year.
Their city used to be full of families, much higher values, lots of great local businesses and some big business headquarters. That's all gone and it's not desirable at all.
Land value taxes are even better. Property taxes provide a disincentive to making the land more productive. A land value tax would incentivize residential landowners to build more units which provides more supply and would lower rents.
The problem with it though is that it is a very regressive tax, especially in states that get the majority of their income from property tax as compared to income taxes (I'm looking at you Texas).
> They can be adjusted annually based off the needs of a local market
Or, in the case of Texas, a very large portion of property taxes in urban centers ends up as recapture and goes into a state-controlled slush fund. These portions (school taxes) are not actually adjusted at all.
> the money collected from property taxes doesn't evaporate from a local area
See above statement again. This may be true for city-level property taxes though.
> Retirees and low income individuals are often able to make cases to reduce their tax burden
I would disagree with this. There are exceptions written into the law that provide exemptions for some of these groups (which are often abused and disincentivise "good" use), but overall lower-end properties have many more comparables to set value based off of, and tends to be much closer to "market". These residents also don't tend to have the funds to many these arguments, and commission-based tax-appealers don't stand to make much money taking on these cases (the absolute dollar value is relatively low). Further, high-value properties without many comparables are the easiest ones to argue for lower tax burden on.
Finally, when property values actually do decrease (due to central bank action on interest rates, etc) it can be difficult to get the assessed value lowered without an actual sale.
Tldr, the current implementation of property taxes in many locations is extremely regressive.
50% of US GDP is about to become US gov't expenditure.