Personally I don’t like the idea of a property tax. You don’t really own your house if some city politicians can just vote for higher and higher taxes continuously and confiscate what you are supposed to “own” when you can’t pay or refuse to pay.
Plus the increase in tax from arbitrary assessments of value is just weird. Why should a house worth more pay more? There should be fixed pricing for the services the city offers (like electricity or whatever), unrelated to how your house gets appraised.
We need to call these articles what they are: a proposal to abolish the concept of homestead protection in the states that have them. The author claims homestead is the reason that California can't properly fund its school system, but this assumes that more money spent on education will always equal better results. If that was true, then California would rank higher in K-12 education than somewhere like Florida, which it doesn't [0].
>> unfortunate reality is that there’s an entire constellation of municipal services and infrastructure required for even suburban development. These things cost money and the best way to raise that money is to charge the people who benefit from the value said infrastructure provides.
The unfortunate reality in my city is that approximate 80-90% of homes (many of which are investor-owned) pay a fraction of the impact they incur on the city. Property taxes may be the most progressive tax burden by a long shot. Prop taxes need to be limited and/or totally redrawn as a concept.
Good for MAGA, if no property tax other things will be used to get revenue.
IIRC, New Hampshire replaces this tax by selling hard alcohol (no private sales), high fees and other things. They get a lot of business from surrounding states for that alcohol. But I think NH is loosing some business to marijuana sales in other states.
Money has to come from somewhere, no property tax, other forms of revenue will be created.
EDIT: I got property and income tax mixed up, but $ does have to come from somewhere :)
> Property taxes, after all, punish development because they factor in the value of the house or whatever other structure happens to be built on top.6 Instead of abolishing property taxes, shifting to land value taxation (LVT) would constitute an actual improvement.
We need both.
We need land value taxation to reflect that land is a limited resource, and incentivize building tall apartment buildings downtown instead of wasteful parking lots.
On the other hand, we still need to tax houses and buildings because they correlate to usage of local government services. Whether it's the fire department where 20 apartments are 20x more likely to catch fire than a single tiny home, or the police where a large rich mansion is more likely to be targeted by theives than a tiny home, or schools where the larger a building is, the more likely it is to have more kids needing education (or more adults who once benefited from public schooling and are now paying it forwards).
Taxes are for allocating originally public resources efficiently (whether radio spectrum or land), and for paying for mandatory government services which you're not allowed to opt out of.
Not everyone needs to live in your particular neighborhood. The US native population is shrinking so baring immigration (which we absolutely do not need more of) housing prices should fall without any development.
This is an oversimplification. Density in fact makes public infrastructure more efficient and more predictable.
As Mason Gaffney notes in his article, "Containment Policies for Urban Sprawl"
"Consider water distribution. If demand doubles within a fixed service area by doubling density, we need simply expand all pipe diameters—and not by double, but by the square root of two, since cross-sections increase with the square of the radius. But if demand doubles by doubling the service area, at constant density, we must, (a) double our pipe mileage; (b) double the cross section of our old system at its base, and more than double it elsewhere, to transmit the extra load through to the new extension; (c) increase pressure at the system load center to maintain it at the fringes (especially if the new lands are higher); and (d) upgrade our pipe-joints to hold the extra pressure.
Actually those four simplest considerations understate the case a good deal. We should add the factor of peaking. The fewer customers on a given line, the higher is the usual ratio of peak demand to mean daily demand because there is less pooling of offsetting demand patterns, and more lawn sprinkling. There is also a factor of planning expansion.
"Containing urban sprawl" does not imply halting growth, but holding it inside compact increments, whose ultimate density is known in advance and will be reached quickly, saving utilities from the waste of under- or oversizing their lines in the face of uncertainty. Urban sprawl as known today not only reduces density but breeds extreme uncertainty of future density."
In the UK we have, not an 'owning a property tax', but instead a 'living in a property tax' (Council Tax). At one point there was an attempt to impose a 'living/breathing tax' (Poll Tax) but even we couldn't stomach that, and rioted until it was got rid of.
Prop 13 is actually worse than the article mentions, in terms of perverse incentives. Because tax rates are effectively frozen and assessed vaule goes up slower than inflation, municipalities can only keep pace with inflation by ensuring that there's a steady stream of new buyers at ever-higher prices. Because of that, they vote to relax immigration requirements and promote new office jobs ("steady stream of new buyers") and restrict the supply of housing ("at ever-higher prices"). Because of that, California needs a constant supply of new industries where they can redirect an ever-greater flow of global income into the pockets of California residents, just to allow government expenditures to keep up with inflation.
Prop 13 basically enshrined a pyramid scheme into the state constitution.
And that has led to all sorts of social ills that people routinely criticize California for. The homelessness crisis is because of the revolving housing door: we don't build new housing, but we do higher more new highly-paid employees, so by the pigeonhole principle the lowest-paid Californians will be forced to either move out or go homeless. The "California conveyor", that Republican-decried phenomena where Californians move out of state and take their politics with them, is all because local governments are forced to limit housing and evict their long-time residents in order to keep tax revenues high. California's focus on high-margin industries like tech startups and entertainment is likewise because everything else doesn't generate the steady stream of new dollars and new workers needed to turn over houses and reset their property tax base. And the short-term focus of these industries, where they're willing to destroy society as long as they become a trillion-dollar company in a decade, also makes sense when you consider that existence within the state is itself a pyramid scheme.
Amazing that Republicans would want to copy that, considering how many of the social ills that they bash California for are direct consequences of it.
States like Texas use property tax to replace income taxes. So where do they go for revenue if the red guards demand the repeal of property tax? Are they wild enough to implement a head-tax? Or do they close their police departments?
The founding fathers would hate to have seen property taxes. It's so unamerican and against freedom.
I can't speak for property other than the one primary residence of a citizen, but the concept of having your land taken away post-purchasing is....absurd.
"But...utilities/services/something?" Pay for them.
Primary residence purchased land ownership for citizens should be a right enshrined in the constitution.
> The United States is a nation of homeowners. This is the result of a concerted effort on the part of the federal government to subsidize homeownership following World War II. Easy credit and car-centric infrastructure changed where (as well as how) Americans live and gave rise to the modern-day U.S. suburb.
Probably the biggest policy mistake ever, in my uneducated (on this topic) opinion.
I think once a homeowner reaches the age of 65, they shouldn't have to pay any more property taxes. I can see the case for people under the age of 65, but for over 65 it just seems like a penalty. Especially when they go into retirement.
Property taxes have no place in a free society. That kind of tax is also known as rent payments. If you stop paying the tax the REAL owner of the property evicts you from the property.
The solution is to replace the property tax with a sales tax.
To ensure that the sales tax doesn't hit the poor too hard the state can determine how much someone at the poverty line pays on average in sales taxes every month ie $200. The state then sends a check for $200 to every state resident every month.
One thing that has surprised me about property taxes is how little people know about how they are calculated. I learned this watching the arguments on Nextdoor whenever there is a bond issue up for vote.
For example there was recently a measure on the ballot here to raise the property tax for the county library from something like 0.32/1000 (i.e., $0.32 for every $1000 of your property's assessed taxable value) to something like 0.45/1000.
The last ballot measure for the library was in 2017, and costs to provide the same level of services today that they were providing then have gone way up.
A lot of people, even people who said they strongly supported the library, were urging people to vote no. Their argument was that assessed property values have gone up by a much larger percentage since 2017 than the library says it needs, so the prior measure should still be raising all that the library needs.
What they didn't understand (and many still did not understand even after I and others explained) is that there are at least 3 different ways that things funded by property taxes work, two of them do not get an increase when assessed values go up, and the library is one of those that does not get an increase.
Those three are:
1. The way most people think they all work. A rate is set once, say 1.00/1000 and if you pay $400 one year and your assessment goes up 20% the next year you pay $480 next year.
2. The way many bonds that fund a specific project work. The bond is to raise a fixed a fixed amount, for example $5 000 000/year for 3 years in order to build something. There is no fixed rate. Let's say you pay $400 for this one year, and your assessment goes up 20%. If the average assessment goes up 20% that year, you will again pay $400. If the average assessment goes up less than 20%, you will pay more than $400. If the average assessment goes up more than 20%, you will pay less than $400. On your tax statement a rate will be listed, but that rate will go down each year that the average assessment goes up and vice versa.
3. The way many bonds that fund open ended things work. They are similar to #2 in that they raise a fixed amount every year, and the rate automatically adjusts down when assessments are up and up when assessments are down. The difference is that the amount raised can increase up 1% a year to cover increased costs without the need for voter approval.
The library bond is a #3. When it passed in 2017 the rate was something like 0.49/1000. It was now down to 0.32/1000 because assessments were up around 50% over their 2017 values. Thus, that 50% windfall that so many people thought the library must have reaped from that rise in property values did not exist. All the library has gotten since 2017 are those 1% increases.
I’m considering selling my home in the spring. But if there will be no property taxes, I’ll change my mind. The reason for sale is I’ll be traveling most of the year and the property taxes cut into my burn rate substantially.
From my perspective, it would be great to drop property tax as then I could do both. But the consequence is nobody else will be able to buy my home.
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[ 3.3 ms ] story [ 42.4 ms ] threadPlus the increase in tax from arbitrary assessments of value is just weird. Why should a house worth more pay more? There should be fixed pricing for the services the city offers (like electricity or whatever), unrelated to how your house gets appraised.
The unfortunate reality in my city is that approximate 80-90% of homes (many of which are investor-owned) pay a fraction of the impact they incur on the city. Property taxes may be the most progressive tax burden by a long shot. Prop taxes need to be limited and/or totally redrawn as a concept.
IIRC, New Hampshire replaces this tax by selling hard alcohol (no private sales), high fees and other things. They get a lot of business from surrounding states for that alcohol. But I think NH is loosing some business to marijuana sales in other states.
Money has to come from somewhere, no property tax, other forms of revenue will be created.
EDIT: I got property and income tax mixed up, but $ does have to come from somewhere :)
We need both.
We need land value taxation to reflect that land is a limited resource, and incentivize building tall apartment buildings downtown instead of wasteful parking lots.
On the other hand, we still need to tax houses and buildings because they correlate to usage of local government services. Whether it's the fire department where 20 apartments are 20x more likely to catch fire than a single tiny home, or the police where a large rich mansion is more likely to be targeted by theives than a tiny home, or schools where the larger a building is, the more likely it is to have more kids needing education (or more adults who once benefited from public schooling and are now paying it forwards).
Taxes are for allocating originally public resources efficiently (whether radio spectrum or land), and for paying for mandatory government services which you're not allowed to opt out of.
As Mason Gaffney notes in his article, "Containment Policies for Urban Sprawl"
"Consider water distribution. If demand doubles within a fixed service area by doubling density, we need simply expand all pipe diameters—and not by double, but by the square root of two, since cross-sections increase with the square of the radius. But if demand doubles by doubling the service area, at constant density, we must, (a) double our pipe mileage; (b) double the cross section of our old system at its base, and more than double it elsewhere, to transmit the extra load through to the new extension; (c) increase pressure at the system load center to maintain it at the fringes (especially if the new lands are higher); and (d) upgrade our pipe-joints to hold the extra pressure.
Actually those four simplest considerations understate the case a good deal. We should add the factor of peaking. The fewer customers on a given line, the higher is the usual ratio of peak demand to mean daily demand because there is less pooling of offsetting demand patterns, and more lawn sprinkling. There is also a factor of planning expansion.
"Containing urban sprawl" does not imply halting growth, but holding it inside compact increments, whose ultimate density is known in advance and will be reached quickly, saving utilities from the waste of under- or oversizing their lines in the face of uncertainty. Urban sprawl as known today not only reduces density but breeds extreme uncertainty of future density."
They want to increase the deficit because it applies pressure (via lack of funding) on the social services they despise.
Prop 13 basically enshrined a pyramid scheme into the state constitution.
And that has led to all sorts of social ills that people routinely criticize California for. The homelessness crisis is because of the revolving housing door: we don't build new housing, but we do higher more new highly-paid employees, so by the pigeonhole principle the lowest-paid Californians will be forced to either move out or go homeless. The "California conveyor", that Republican-decried phenomena where Californians move out of state and take their politics with them, is all because local governments are forced to limit housing and evict their long-time residents in order to keep tax revenues high. California's focus on high-margin industries like tech startups and entertainment is likewise because everything else doesn't generate the steady stream of new dollars and new workers needed to turn over houses and reset their property tax base. And the short-term focus of these industries, where they're willing to destroy society as long as they become a trillion-dollar company in a decade, also makes sense when you consider that existence within the state is itself a pyramid scheme.
Amazing that Republicans would want to copy that, considering how many of the social ills that they bash California for are direct consequences of it.
Whatever they're saying, ignore the words and look at the effects
States like Texas use property tax to replace income taxes. So where do they go for revenue if the red guards demand the repeal of property tax? Are they wild enough to implement a head-tax? Or do they close their police departments?
I can't speak for property other than the one primary residence of a citizen, but the concept of having your land taken away post-purchasing is....absurd.
"But...utilities/services/something?" Pay for them.
Primary residence purchased land ownership for citizens should be a right enshrined in the constitution.
Probably the biggest policy mistake ever, in my uneducated (on this topic) opinion.
The solution is to replace the property tax with a sales tax.
To ensure that the sales tax doesn't hit the poor too hard the state can determine how much someone at the poverty line pays on average in sales taxes every month ie $200. The state then sends a check for $200 to every state resident every month.
For example there was recently a measure on the ballot here to raise the property tax for the county library from something like 0.32/1000 (i.e., $0.32 for every $1000 of your property's assessed taxable value) to something like 0.45/1000.
The last ballot measure for the library was in 2017, and costs to provide the same level of services today that they were providing then have gone way up.
A lot of people, even people who said they strongly supported the library, were urging people to vote no. Their argument was that assessed property values have gone up by a much larger percentage since 2017 than the library says it needs, so the prior measure should still be raising all that the library needs.
What they didn't understand (and many still did not understand even after I and others explained) is that there are at least 3 different ways that things funded by property taxes work, two of them do not get an increase when assessed values go up, and the library is one of those that does not get an increase.
Those three are:
1. The way most people think they all work. A rate is set once, say 1.00/1000 and if you pay $400 one year and your assessment goes up 20% the next year you pay $480 next year.
2. The way many bonds that fund a specific project work. The bond is to raise a fixed a fixed amount, for example $5 000 000/year for 3 years in order to build something. There is no fixed rate. Let's say you pay $400 for this one year, and your assessment goes up 20%. If the average assessment goes up 20% that year, you will again pay $400. If the average assessment goes up less than 20%, you will pay more than $400. If the average assessment goes up more than 20%, you will pay less than $400. On your tax statement a rate will be listed, but that rate will go down each year that the average assessment goes up and vice versa.
3. The way many bonds that fund open ended things work. They are similar to #2 in that they raise a fixed amount every year, and the rate automatically adjusts down when assessments are up and up when assessments are down. The difference is that the amount raised can increase up 1% a year to cover increased costs without the need for voter approval.
The library bond is a #3. When it passed in 2017 the rate was something like 0.49/1000. It was now down to 0.32/1000 because assessments were up around 50% over their 2017 values. Thus, that 50% windfall that so many people thought the library must have reaped from that rise in property values did not exist. All the library has gotten since 2017 are those 1% increases.
PS: the library measure did pass.
From my perspective, it would be great to drop property tax as then I could do both. But the consequence is nobody else will be able to buy my home.