The Case Against The Property Tax
R. Alex Whitlock
Thomas Jefferson used to speak admirably of the yeoman farmer, rugged citizens of the new American nation that lived self-sufficiently off their land. While farming has been commodified and the land of yeoman farmers has long since gone, in some ways the spirit lives on. The notion of private property was one of the foundations of our country and is the very foundation of our economic system. Even in areas where we deviate from the free market model, we often do so in ways that allow people to acquire land. Government programs that help poor people get their own house are neither unpopular with liberals or conservatives. While ownership of all sorts of property is good, the ownership of land is paramount.

It's ironic, then, that our local and state governments' tax policies make it so land is the one thing that we never truly own.

If I buy a comic book, that comic book is mine. I can read it or not. I can put a match to it and burn it. But unless I do something to it or create unrelated financial obligations that the money the comic book is worth is required to make amends, no one can take it from me. If the comic book becomes super valuable, all the better. If it becomes worthless, I still have it to read or ignore as I choose. The same is true of a car. The car may require maintenance, and if I fail to perform it could die, but the broken and rusted piece of junk is still mine. I may have to pay the government money in the form of registration and emissions test and it may have to pass a safety inspection for me to be able to use it on public roads, but even if I refuse to do so I can drive it on my own property or let it sit there and gather dust. Absent unrelated financial obligations, no one can take it from me. No matter how much or how little it is worth, I never have to buy it again just to own it. Once the last payment is made, I never have to make another payment in order to give it up.

We've apparently decided that property (land property, to be specific) is different. If I own a tract of land outright, I still have to pay the government to keep it. I have to make payments on that land for the rest of my life. A lifetime of payments on my own property. Furthermore, how much I pay depends on things beyond my control. If the area in which I live becomes popular, the land values will rise. Due to nothing I can control, no action on my part, and no decision that I've been made, I can be forced to give up the property that I have bought and paid for simply because I can't make the continually rising payments. Or you could be caught in the crosswind of an ambitious mayor's use of targetted foreclosure so that he can remake your area in a way he sees fit.

But not even including eminent domain or the raising of tax rates, you're at the mercy of your surroundings as to whether or not you can afford to live on the property you've purchased. In this way, the Property Tax is fundamentally different from any other tax there is (with the possible exception of the estate tax). Yes, you have to pay taxes on income and that's not voluntary. But once you pay the taxes, most of the rest of the money is yours to do with as you please. You will likely have to pay taxes again later in the form of sales taxes, but once you fend off that two-headed beast, the rest of it is yours until the day you die. No one can take it from you unless you incur debt. You will not have to make another payment on it. It's yours.

And this is the case for anything you purchase except when it comes to the ownership of one of the cornerstones of our society.


Posted to Land of the Free
 
 

Observations

 
Kavey wrote:
case against the sales tax?
5/3/2005
 
RAW wrote:
Err, oops
5/3/2005
 
Linus wrote:
Well stated.

Out of curiosity, what do those who support property taxes like about them?
5/3/2005
 
RAW wrote:
Generally speaking, property taxes are among the most progressive taxes around. The more money one has, the more valuable their house/property, the more they pay. While I sympathize with that argument, if we want to tax the wealthy at higher rates, we can do that through income taxes.

The better argument is that it's the most practical way for local jurisdictions to tax without businesses jumping to the next town over. For towns like Taylor Lake Village, which are completely residential, it may be the only way to collect taxes. Sammler pointed it out in the post Trackbacked above. I don't have a good answer to that dilemma right this minute, except that it may be a necessary evil on the local level, but ought to have caps in place so that taxes can't increase simply because property values go up.
5/3/2005

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