There are some diaries alleging that Mitt Romney has done something wrong by asking for his property in San Diego county to be reassessed to way less than the sale price from a few months before. For all I know, there is some funny business there.
But on it's face, this isn't even close to being irregular. "You people" don't have Swiss bank accounts, offshore tax havens, and so on. But we do have homes, a lot of us. And we pay property tax based on what the homes are worth.
If you want to know why California is a perpetual budge basket case, its' precisely because people don't pay taxes based on the market price for the property, or even anything close to it.
Why? This is why:
CALIFORNIA CONSTITUTIONHere's what Warren Buffet pointed out about our flawed system in California (from the WSJ):
ARTICLE 13A [TAX LIMITATION]
SECTION 1. (a) The maximum amount of any ad valorem tax on real
property shall not exceed One percent (1%) of the full cash value of
such property. The one percent (1%) tax to be collected by the
counties and apportioned according to law to the districts within the
What I said in respect to property taxes was very specific. I gave him an example of three houses, two in Laguna Beach and one in Omaha. The first Laguna Beach house is a property that I bought in the early 1970s. It has a current market value of about $4 million and, because of the limitations embodied in Proposition 13, carried taxes of only $2,264 in 2003 vs. $2,241 in 2002. The second house, located just in back of the first, is one that I purchased in the mid-1990s. It has a market value of about $2 million and, simply because I bought it later than the first, carried taxes of $12,002 in 2003 vs. $11,877 in 2002. I pointed out to Joe that these figures mean that the tax rate on the second house -- same neighborhood, same owner, same ability to pay -- is roughly 10 times the rate on the first house.Buffet doesn't specify whether they are the magical "beach front" property that never loses value according to one rec'd diary, and this link is from 2003, but the same law remains in effect.
I then referenced my house in Omaha, which I believe to be worth about $500,000 (though it's assessed at $690,000). Taxes on it were $14,401 in 2003 and $12,481 in 2002.
My grandparents paid $36,000 for their house that was worth nearly a million dollars pre-crash in Orange county. I wrote the bill once, it was a few hundred dollars. That same year, my property taxes were over $5,000 on a house I bought in 2005.
Maybe Romney should be paying more in taxes on his mansions. Hell, maybe there is some shenanigan with his reassessment. But the problem is that people who have tens and hundreds of thousands of dollars of wealth (still, post-crash) don't have to pay taxes on it. That is what is bankrupting our state, our schools, and our future.