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View Diary: Progressive Tax Reform: The Land Value Tax [w/poll] (74 comments)

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  •  Great letter (0+ / 0-)

    Prop 13 is a travesty.

    •  Prop 13 enabled my mother to die in the home she (3+ / 0-)
      Recommended by:
      MarketTrustee, craiger, wondering if

      loved and to be able to pass that on so that I as a disabled person am able to own my land and die on the property I love.

      It has saved the property of millions throughout the years or do you think the senior citizen could have payed the taxes after their property was valued at 20 times what they paid for it.

      "every saint has a past, every sinner has a future" Oscar Wilde

      by buddabelly on Tue Jun 12, 2007 at 04:17:30 PM PDT

      [ Parent ]

      •  What about the people without property? (0+ / 0-)

        The tax may be good for you and your mother, but it's not fair to those of us who don't own land.  Also, those people whose land is now worth 20x what they paid for it are sitting on a massive capital gain--surely they can use a financial mechanism such as a reverse mortgage to pay their fair share of property taxes.

        •  Everyone makes the choice to purchase or rent (0+ / 0-)

          you if you rent pay property taxes in the rent. I can not see how you can call a tax scheme that would drive many on fixed incomes even further into the poor house "Progressive".

          "every saint has a past, every sinner has a future" Oscar Wilde

          by buddabelly on Tue Jun 12, 2007 at 04:35:50 PM PDT

          [ Parent ]

          •  land ownership (0+ / 0-)

            Land ownership is more highly concentrated than wealth or income.  There is a very high correlation between land ownership and wealth.  I'm not sure how taxing the wealthy is not progressive.

            •  because not all land owners aare wealthy (0+ / 0-)

              by any stretch of the imagination. Many are barely middle class people who busted their ass all their lives to own their home.  

              While reinstating the income taxes on those making over 200,000 a year isn't going to impact many lower or middle class families this proposal would.

              Same with the inheritance tax. with an adjustment for increased farm and ranch values it won't hurt the middle or lower class while increased land taxes will.

              Do you really think that an apartment owner won't raise the rent if the property taxes go up?

              "every saint has a past, every sinner has a future" Oscar Wilde

              by buddabelly on Tue Jun 12, 2007 at 04:45:36 PM PDT

              [ Parent ]

              •  but... (0+ / 0-)

                If the land isn't worth much, then there won't be high taxes on it.  The taxes would be proportional to the wealth due to the land.

                •  According to whom? (0+ / 0-)

                  My place here could be worth a fairly frightening amount if it was all split up and developed into a sea of condos. As it is, I'm doing well to just make our meager farm income pay the current taxes (and I have a real job with which to make our actual living). If your measurement on "wealth due to the land" means "whatever the landrapists can get for it, regardless of what it is currently used for", I'd politely suggest that you reconsider.

                  There are very, very few "wealthy" family farm owners- but there are a lot of very, very wealthy developers who'd just dearly love to suck up every square inch of America (especially if it is within 100 miles of some already-existing urban area) and stick a Krispy Kreme and some high-density housing on it. It happens every day, and every family farm that gets turned into a strip mall should be regarded as a crying shame. The landrapists have much louder voices, and much deeper pocketbooks, than us: they'll be the ones who set the "value", not us.

                  I guess that I shouldn't oppose that, because what we do with our little bits of green isn't very efficient... However, I'm probably not the only one happier on a tractor than in a cubicle.

                  •  landrapists (0+ / 0-)

                    If you can sell it to "landrapists" for millions of dollars, it sounds like they have a more valuable use for the land than you do.  Part of the point of this tax is that it promotes efficient use of land, and selling to "landrapists" is often efficient.

                    We can keep green space around in urban areas with the right incentives/zoning, which should be considered in conjunction with such a tax.

                    I don't think this tax would be a windfall for wealthy developers--much of the point of it is that it is supposed to be highly progressive.

              •  rent (0+ / 0-)

                Also, regarding rents, I've read a bit about this, and what I've read indicates that rents would not go up since the land values would go down proportionately.  Keep in mind that the theoretical value of the land is equal to the expected present value of net future rents.

      •  I should at the very least be limited... (1+ / 0-)
        Recommended by:
        klarfax

        to those who live in their homes.  Right now real estate investors pay a fraction of the tax of their neighbors who may want to buy their first home.

        So they rent it to them, and these poorer people never get any equity, while their landlord is silently subsidized by all who came later.

        All taxes hurt, and in individual circumstances are unfair. Even if Prop 13 were repealed or altered, retirees or low income people could be allowed to defer their taxes until they sell.

        This law helped you, and I certainly understand why you would like it.  I also like laws that I benefit from.

        It is reflected in this aphorism: "Where you stand depends on where you sit"

        •  highly recommended n/t (0+ / 0-)
        •  As I understand prop 13 the tax benefits (0+ / 0-)

          dissappeared when the property was sold.

          If that isn't the case then that would be a legitimate change. Also I do agree that possibly it should only apply to owner occupied housing but if my first scenario is correct as I remember it then investors arn't making the killing you say as the taxes are adjusted to the assesed value upon purchase.

          "every saint has a past, every sinner has a future" Oscar Wilde

          by buddabelly on Tue Jun 12, 2007 at 04:33:48 PM PDT

          [ Parent ]

          •  People next to me paid 35K 30 yrs ago... (1+ / 0-)
            Recommended by:
            klarfax

            they have paid a fraction of the tax rate of newer owners.  New owners pay 20X that price and pay 10X the taxes.  

            They have rented it all that time, and do not pass on the tax savings to those too poor to purchase.  And those who overreached to buy during the last few years with mortages allowed by the fed and state government are doubly screwed.  They will lose their homes and never become owners.

            The Investors who bought thirty years ago will do just fine.    

            This is a case of a law being unjustifiable, but absolutely politically sacrosanct.  It will never be changed.  Yet, it quietly, year after year, increases the breach between the richest and the poorest, having nothing to do with merit.

            And BTW, you won't find a Democrat in the state to take my position.

            •  I would like to see in real numbers the (1+ / 0-)
              Recommended by:
              wondering if

              investors like your neighbors. My guess they're fairly small.

              The majority of people who have benefitted throughout the years have been the lower middle class and the elderly on fixed incomes.

              I could see requiring owner occupancy for the tax break that would be a fair outcome but without the moderating effects of prop 13 how many elderly or middle class people would have been able to stay in California all these years, everyone in my family would have been taxed out of the state.

              "every saint has a past, every sinner has a future" Oscar Wilde

              by buddabelly on Tue Jun 12, 2007 at 05:01:54 PM PDT

              [ Parent ]

              •  Adjusting it rather than eliminating it... (1+ / 0-)
                Recommended by:
                buddabelly

                could be best.  There is nothing sacred about the 2% cap, especially when the value has been increasing at about 7-8% a year, or more. Perhaps 3 or 4% max would be a balance.

                I do understand the advantages of the law, but it doesn't make sense for a non occupied or commercial property, which is included.

                Property tax is a thorny issue everywhere. It could be adjusted so that elderly people would have their taxes deferred.  There are ways to make it fairer.

                •  I do agree that some changes could be made (0+ / 0-)

                  but I see everything under the sun in the way of the state crying broke being blamed on prop 13. Iirc it passed in the 70s didn't it? if so how many properties are really still affected.

                  I do agree that commercial property should be exempted and possibly even non owner occupied, but Cal's land values are going to dive as they have already started and it could get ugly before it's over.

                  "every saint has a past, every sinner has a future" Oscar Wilde

                  by buddabelly on Tue Jun 12, 2007 at 05:21:47 PM PDT

                  [ Parent ]

                •  deferral (0+ / 0-)

                  I like the idea of deferral, at least for some subset of the population--it would make this more politically viable.

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