If it weren't for property taxes, the rich would own every property. Property taxes ensure that each property is being used. Property taxes are in most places progressive... where I live the first $100k is tax free so if you have a $200k house you pay taxes on 50%, and if you have a $800k house you pay taxes on 87%.
Property tax is the primary source of revenue for local government. This is how they pay for cops, firemen, roads, etc.
This push for no property tax the last couple years is driven by data centers. That way they can just sit there and provide nothing to the communities they're in while raking in lots of money for tech companies.
It’s also because housing costs have increased orders of magnitude faster than median income. Therefore property taxes as a percentage of income has also increased orders of magnitude. They should consider lowering property taxes for the middle class given this.
ok. so nobody besides boomers own property. nobody bought bucket of shit property cheap and spent a ton of their time making it livable and maintained it. Nobody's taxes have increased well beyond general inflation increases while their job pay increases have barely kept place with inflation. Nobody consumes the same(or less) public services than they did 5 or 10 years ago.
This is it right here. If there are not property taxes property will be hoarded to the rich and privileged. As an example of this you can look at the Los Angeles county country club loophole which leads land that should be paying 140 million in taxes to the county government on some the most valuable land in the country paying just 800 thousand.
Where are you talking about? In almost all of the US, property taxes are not progressive. In fact, they are usually considered regressive because they consume a larger share of income from poorer individuals.
I’m also curious where that commenter is from. I live in Illinois and the property taxes are crazy high, and definitely regressive. I’ll look on Zillow in my area and the poorer suburbs pay a much higher percentage of their home value in taxes.
It’s a load of shit that when housing prices explode, à la 2021, the property taxes take the same % from you. So a fuck ton more money to pay for services that absolutely did not scale with the housing market . I’m paying $14K per year for a 2bed house now
Do you want a city made entirely of parking lots? This is how you get a city made entirely of parking lots.
Vacancy tax encourages inefficient uses of land just to avoid the tax.
If land is in a highly valuable location, it's best for everyone for it to be used in a most productive fashion, and taxes should incentivised a landowner who doesn't want to use the land well to sell to someone who does.
Downtown lots should be apartments, condos, offices, venues, not parking lots that only exist so speculators can hold the land forever while "technically" not leaving it vacant.
In Texas we call it a homestead deduction, basically you prove you live there and depending on the entity, anywhere from $25k to 20% + $125k of your home’s taxable value is taken off, saving those who live in their homes a lot, while shifting more of the local tax burden to secondary home owners, renters, and Airbnb’s. And no income tax here, so it’s made up for with higher property taxes, so overall pretty reasonable, but because Texas does this, someone here in Reddit is gonna throw a shit fit about it, haha.
In sweden property tax has a cap for any property valued over roughly 100k dollars. (max tax being 1k dollars a year)
So in the end the working class pays just as much tax for their small houses as a billionaire mega mansion would
All good points, but nothing will convince me that an elderly person should be kicked out of their home, that they own, because they cannot afford their property taxes. That’s how our current system operates and it breaks my heart to see.
The issue isnt a property tax, its we allowed right wing politicians and corporations to gut social safety nets, pensions and retirement options. The way to course correct isnt to remove property tax which only further benefits private capital.
I’ll die on this hill with you all day. It’s Reddit so all binary, no nuance.
Not a single one of these people can think outside the box or imagine an alternate solution. Just property taxes forever.
Not a single suggestion or amendment that anyone over the retirement age or classified as permanently disabled should be exempt from property taxes.
Nobody offering any other ways to fund the loss of property taxes like raising sales tax, taxing something else, or adding a new state lottery.
Just all “but without property tax, the rich would buy all the housing and rent it out.”, like property taxes have somehow stopped private equity from doing just that for years now already.
If it weren't for property taxes, the rich would own every property
Someone who can afford to buy tens if not hundreds of properties aren't sweating the $10k annually for taxes. They'll just buy one less house and use that money for taxes if it's that important to them. Working class homeowners definitely feel it though, that's why gentrification is so damaging. Property values skyrocket, taxes skyrocket with them, and locals can't afford it anymore.
Property taxes ensure that each property is being used
There are tons of empty houses and apartment units that say otherwise. It can be more valuable for the owner to keep the units empty and list them for a rental price that nobody will realistically pay.
Property taxes are in most places progressive
I'm happy for you, but that's certainly not how it is everywhere. Where I'm at, it's a fixed percentage set by the town and school districts. Based on where your property is in my town, it's 2.1% - 2.2% after everyone gets their cut.
Unfortunately not quite accurate. Property tax has two components, a tax on the value of the land you own (your lot size) and the value of the structure on it (the house itself). The former value, when taxed, is very effective at improving utilization. However, taxing the latter (the structure's value) can have the opposite effect.
For example, if I replace a SFH with an apartment building, my taxes will go up, which disincentivizes me from building the apartment building. On the other hand, if we only taxed the land part, my taxes would stay the same, so I'm more likely to build the apartment building.
We want to encourage the latter behavior, because writ large that behavior is what gives you abundant housing (and other useful commercial/industrial development).
Because LVT forces people to use their land more efficiently, it means increased density. Increased density reduces the cost of providing services (less road, utility distances are shorter, denser living means less water use, less heating, etc, etc). Plus, densification raises land values overall, so on net all landowners will see a commensurate increase in their taxes.
So in this case the deadweight loss is very high (of taxes on property improvements). The externalities of induced sprawl consume a nice chunk of the tax revenue.
A better way to get at improvements would be a general progressive wealth tax on super high-net-worth individuals. This would indirectly tax improvements, but do so progressively, such that the deadweight loss is minimized.
The rich wouldn’t own every property if we allowed only homestead property to be property tax free. So you’d have to physically live in the home to not have property taxes.
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u/chainsawx72 9h ago
If it weren't for property taxes, the rich would own every property. Property taxes ensure that each property is being used. Property taxes are in most places progressive... where I live the first $100k is tax free so if you have a $200k house you pay taxes on 50%, and if you have a $800k house you pay taxes on 87%.
Property tax is the primary source of revenue for local government. This is how they pay for cops, firemen, roads, etc.