Should property taxes be swapped out for something else?

Post Reply New Topic

Almost exclusive rights is like almost pregnant.

ruveyn

On one hand I'd agree - DC talks about everyone leasing - in a sense we're already there and paying down a house both to have a reserve of equity and simply pay a lower rent. At the same time though, on a different layer, if companies did buy up big swaths of homes and had no residual to pay on them they could run entire cities. While I do believe that the world just sucks this badly that capitalism is the best choice on a list of many barbaric systems, I still get that it will follow contagium of moral hazard to the letter simply because of what it is and how it operates.

State governments have been making money from lotteries, and local governments from casinos.

They might also consider opening brothels.

Nevada's tried it out. If we get a major city like LA or NYC to sign on to that it might be an interesting experiment. From what I keep hearing about how NYC does taxes it wouldn't shock me if they're chomping at the bit to legalise prostitution.

If you are very concerned about a pensioner that is a homeowner being plunged into poverty by property taxes there already exists a system whereby that pensioner can turn equity into cash courtesy of private sector banks offering mortgage equity release.

This does of course mean that when the old goat snuffs it the offspring have to pay the debts before they get the property or sell it back it into circulation and take a lump sum of money.

If you only ever tax labour instead of assets (in this case property) there is no way releasing that wealth back into circulation. I don't think even Ruveyn or Raptor could support a system that allows the descendants of Henry Ford to live in opulent, unproductive idleness off his achievements generation after generation for millenia.

In some states, senior citizens and the disabled can have their property taxes reduced.

That's all the while crossing their fingers hoping that reverse mortgage doesn't tap out before they do.


Well, the trick really is this - it would either allow everyone's descendents to do so or it wouldn't. If it would send the banks on a buying spree and mean a renting nation as a whole - terrible outcome.

I've given some thought to the idea that removal of property taxes creating a tax shelter which eventually would lead to banks buying up all of the land and creating a nation of renters and I honestly don't think that it holds water. In order for the banks to get any return on that investment, they would have to rent or lease the property out for use. This adds a whole new level of complexity to the investment. You now have to consider maintenance costs, repair issues, upkeep and everything else involved in being what is essentially an corporate land lord. All of which could easily cost more than the taxes that the bank is attempting to avoid in the first place. It would be much easier (and far less risky) to stick to traditional investment strategies. I'm sure that some investors would attempt this approach, but it certainly wouldn't be the free-for-all type of scenario that it's been described as in this thread.

I will rephrase if you are not happy with my semantics.

Paying property taxes gives land owners a hell of a lot more rights than renters have.

Nope. That is the point.

When you control sufficient property to restrict supply it doesn't matter if you leave it empty or not because you can make money by virtue controlling the availability of land.

If there are property taxes you can NOT afford to leave the land unproductive to create an upwards pressure on the price level.

If you leave the land fallow you are still being taxed on it, eventually going bankrupt at which point the land is sold to people who will make productive use of it.

In Britain where there are no property taxes we have over a million empty homes, including multimillion pound properties lying empty for decades.

Why can people do this?

Because it costs them nothing and pushes up the cost of land with building permission so high that the actual cost of the building is no great loss. You can afford to knock it down and start again because the value of the land is far higher than the materials and labour required to build a brand new house.

Why not? Americans have been f*cked by their government since before 1776.

ruveyn

At present, the government imagines (at least officially) that is possesses a monopoly on sexual intercourse, which it taxes once through the issuance of a marriage license.

Rather than declaring war on sodomy and non-marital coitus, the government really should be taxing these activities, as it taxes booze and tobacco, and should tax other drugs that are presently illegal.

Last edited by pandabear on 10 Feb 2012, 6:13 pm, edited 1 time in total.

And just how will the government quantify that which is being taxed? But putting meters on the nether parts of citizens?

I have it! Tax orgasms. It's the coming thing!

ruveyn

That could make washing or flushing a challenge.

My 5 acres are mine alone.

Yes. But when your five acres abut my five acres--or even our properties are merely in the same community, what you do on your property affects me.

If you choose to live off the grid, all well and good.

But where are you getting your water? If you are drawing from a river, you have to address the riparian rights of those who live downstream. If you dig a well, you have to address the water table rights of other people who rely on the water table. Local municipalities are potential affected in either case.

Where are you going to put your garbage? You can certainly take it to a landfill yourself and pay the dumping charges, but what if you don't--what if you bury your garbage? What if you are creating hazardous waste in a business you run on your property? Is the community supposed to sit idly by while you bury drums of hazmats to pollute the water table?

You don't get to insulate yourself from the local community. You might be able to put fences up around your property, but you cannot put fences around the consequences of your occupancy. The tax obligation on your property doesn't merely pay for the services that you might choose to forego, it also provides a means to aggregate the responsibility for general services from which you are a beneficiary, whether you claim them or not.