Explain property taxes to me....

[Superfly]

How can a government tax you on something that is 100% yours? I don't understand how they can continue to levy taxes on things like homes, land, etc when those things are yours.

Cars I can understand as cars travel public thoroughfares, but a piece of land is no longer public, so I do not understand the justification in taxing it.

So, can somebody explain the rationale behind property tax?

Thanks.

[waylon]

1. Fair or not, thats up to you but..

If you own a home, you still occupy land. Tax dollars are spent protecting that land and enforcing the laws of that land.


Simple I know but thats how I get over it.

[Superfly]

4. I thought that's what income tax was for?

And sales tax.

[JanMichael]

9. Please read this link for a description of taxation.

http://www.psnw.com/~bashford/taxation.html

Thanks:-)

[Superfly]

11. That is not a description of tax..

rather somebody's opinion on how some taxes are pro/regressive. I am asking how the government can justify taxing something that is not theirs.

[Snow]

13. That's an odd comment...

How would the government tax something that is theirs?

[Superfly]

15. Things like commerce

are theirs, thus the justification for sales tax.

[Snow]

24. How do you figure commerce belongs to the government?

I'd think a lot of merchants and shopkeepers would argue with you. And in fact any robber baron corporation worth its salt has already opted out of that system.

[ewagner]

2. To pay for common services

Police Protection, Fire protection, water service, sewer service (sanitary and storm), schools, roads, common facilities (civic centers, senior centers etc.,)and the general administration of services (Clerk's office for instance).. There may also be economic development activities which benefit everybody and the cost is assessed against property.

There's a huge disconnect about taxes and services........

[Superfly]

5. I thought that's what income and sales tax was for.

[ewagner]

7. Depends on the State you live in

In Wisconsin, only the State can levy Income taxes and local governments are allowed to only levy property taxes.

[Superfly]

12. That's interesting...

but I still would like to know how a government can tax something that is not theirs.

[ewagner]

41. You have your own fire fighters?

Your own cops?

[sangh0]

49. Why do you keep repeating that nonsense

when it's already been pointed out that the govt taxes commerce but doesn't own commerce (which was pointed out in a post you have neglected to respond to)?

[underpants]

16. Pick your poison. If there were no property tax you would pay more ...

in income or sales tax. It all depends on the demand on the government services.

Two for instances. Here in Va. 70% of the "car tax" was done away with so the localities who collect it had to have revenue from another stream (let's skip over cutting services for now). The city of Richmond raised the assessed value of most homes by ~40% in a two year span thus filling in (sort of) for the loss of the car tax revenue.

A co-worker from Pennsylvania didn't understand the tax on cars and boats which they don't have in Pa. (I hope I am getting this right) so I asked her, "Are there any taxes in Pa. that we don't have here?" She said, "Yeah in Pa. they have a 'school tax' $300 per person"

You are going to pay it one way or another and often for newspaper headlines they don't raise TAXES but fees and licenses.

[Superfly]

19. As another VA denizen...

my question arose out of the myriad of taxes we pay here in this state. I pay tax on my car, my income, my purchases, and the list goes on and on...

[underpants]

27. Yep but they will tell you how much the hate taxes

Warner, as you know, proposes a plan that cuts taxes on 65% of Va. taxpayers but the wingnuts marched yesterday demanding NO RAISING TAXES!!!.

They probably aren't aware of how his plan will affect them personally they are just against any and all taxes and all tax hikes.

People here are amazed when the find out how much they actually pay. They think the Repubs have been watching out for them all this time and when they find out (for instance) that there is no tax on basic food items (flour, milk, bread, and foodstamps items) in New Jersey they are often shocked.

I don't know where we actually rank but it is up there. The "Taxachusetts" BS is just another "tax and spend liberal" manifester.

[0rganism]

57. Repeat: it depends on the state in which you live

In Oregon, we have no sales tax. Everything has to come from property and income taxes, or dedicated surcharges (e.g. cigarette tax, gas tax).

[Pithlet]

61. Everyone has to pay those

Property owners benefit more from those services provided. As a homeowner I need to pay for the services that make my property more valuable. I don't see why those taxes should be removed, and the burden shouldered more by renters, while my property values continue to sore because of the quality of those services. I also don't want to see those services diminished, for anyone's sake.

[muriel_volestrangler]

3. Since you own part of the country

you have to help pay to keep it running. That way you get the benfit of continuing to own it, rather than having it taken off you by the next band of thugs.

[demsrule4life]

8. You can pay your taxes on time all the time

and still lose your property to someone like Walmart since they can pay more taxes than you.

[JanMichael]

6. You're kidding, yes?

I mean really, do you think a house sits independant from everything, a city for instance, around it?

Property taxes generally cover the everyday cost of running city government (Police, municipal courts, fire, emergency medical services, code compliance, public works (Roads, sidewalks, bikepaths etc.)etc.). Taxes are used for Capital Improvement Projects and other such things which people both request (Sometimes Demand) and enjoy.


Ay caramba...

[Superfly]

10. Calm down...

If that's what property taxes are for, then why am I also paying state, local, and federal income tax and sales tax?

My question is, how can you be taxed on something that is yours and not the government's.

[demsrule4life]

20. I don't know what is worse paying taxes or not

When I owned a house in Germany I didn't have to pay taxes on it. But I had to pay separately for garbage, sewer and god forbid if the town decided to redo the street or sidewalk on the street you lived on. That cost me about $30,000. I agree with you that paying taxes suck, but the alternative can suck more.

[Fescue4u]

63. Hmm I pay property tax

And I still pay seperately for garbage sewer and my sidewalk.

[Snow]

21. Okay, see my post above....

about your persistent question
how would the government tax something that belonged to the government? Does your money belong to the government more than your property? It's an odd question, as I said.

and to follow up on your other query, not that you understand what property taxes (county or city) are for, you need to learn why the state and the feds would need money. By the way, very few local governments levy income tax - and there're even some stated that do not have an income tax. Anyway, what does your state do for you and the rest of the people in your state? Well, they support a lot of the education, there's a state legislature, there's roads, there's a state health department, there's a ton of agricultural offices, on and on. You can argue the value of some of these, but some of them are really essential. Same deal with the feds. I'd prefer to flush the entire War Dept and anything to do with US's collection of WMD's myself, and give tons of money - my federal income tax money - to the National Endowment for Arts and the National Institutes of Health. But that's just my preferences.

[JanMichael]

22. Because States, Counties and Cities, are all chartered to do...

...different things and provide different services. Should DC determine where a sidewalk goes or if a park needs a swing?

Everything does not flow from one source and frankly that's a good thing. It's about localizing some control over our living environments.

"My question is, how can you be taxed on something that is yours and not the government's."

That comment doesn't quite make sense to me...How would Government tax itself? Anyway the idea that real property is "private" is no different than the idea that it can be taxed, both are part of the social contract. Also the "Government" is "us" so seeing it as a separate entity is self defeating. It's only as good as the effort put into the collective work it sets out to do.

[Mountainman]

14. I just bought land and built a new house and had to pay school fees

I had to pay $3,800 for school fees. It is supposed to offset the impact my family will have on the local school system. Well we don't have any kids so I don't think we will have any impact on the local school.

But, I am happy to support my local public school and want the best education available for my neighbors kids.

It is not always about you and what you think is fair for you. To have the kind of fair and equitable society we all want, we have to pay for it and those who can should pay more than those who can't.

I don't want to see us become a third world country with only the haves and the have-nots.

[Superfly]

17. I understand the need for taxes, and that is not in question

I am just wondering how the government can tax a thing that does not belong to it.

[Mountainman]

25. I didn't try to answer your question. I think it is not relevant

A society makes laws for the betterment of the society. If you want to live in the society, obey the laws they create or don't live there. The tax laws were created by a government elected by the citizens who gave the elected the right to make tax law.

On edit:

If you don't like the laws, work to change them or try civil disobedience or jury nolification.

[Superfly]

28. If it's not relevant, then why did you respond?

"obey the laws they create or don't live there."

That sounds just like a comment I saw on FR :"If the muslims don't like it here, they can always leave."

:puke:

[Mountainman]

30. I am about to edit my post

[JanMichael]

26. Short answer? Everything "belongs" to it.

On every level. A nation state is both the People and everything else in it held together, organised if you will, by these cute little things called "Laws".

Does that help?

[Superfly]

29. What I don't understand is your tone...

And that is not helping.

[JanMichael]

35. I was befuddled by your initial question.

And the "How can government tax something that isn't it's own" comments.

Sorry if I seemed hostile, I'm not.

[sangh0]

51. I am also befuddled by that question

and even more befuddled by Superfly's refusal to respond to those posts which explain that "things the govt does not own" are the only things that are taxed

[freestatevet]

36. Like my wages, you mean?

The Government doesn't "own" them either, but they sure tax the hell out of them!

[fob]

37. Superfly, you seem to have a disconnect to hearing the answer

"The Government" provides services to you in exchange for a fee(can't do it for free). One of the ways they collect the cost for these services is through property taxes. The government doesn't own your labor but they collect income tax from you. Your property generates costs for the government, so they collect a tax. For instance, you may be connected to the city water system, or the public utilities system. Look at your property tax bill and tell us what it says it's for. There will most likely be sewer, schools, roads and the like listed. The common denominator for these services is YOU and YOUR PROPERTY! The more property you have the more services you use, thus it makes sense to use property as a basis for taxation to cover the services to said property(ies).

Think of it this way, the government doesn't "tax" your car or your property, it does, however use the VALUE of your car and the VALUE of your property to try and spread the cost of the services they provide across the public served.

As another poster said, the other choice is pay for service as you go, but I don't htink I want my rural friends to pay $20 to mail me a letter while it costs me $0.04 to respond.

The other thing is the government can make a law allowing it to do just about anything, such as levying a fee against something it doesn't own!

[Superfly]

38. Good answer, thanks!

[Kaysera]

45. Why do you think that the government has to own what it taxes ?

[sangh0]

50. Why do you keep repeating this nonsense

about taxing things the govt does not own? "Things the govt does not own" are the ONLY things that are taxed.

[greekspeak]

62. Why do you keep asking this question?

"I am just wondering how the government can tax a thing that does not belong to it."

It makes no sense, and you keep asking the question. I cannot figure out what your gripe is. Do you pay to many taxes? Are there too many kinds of taxes? Do you want the government to own all the land so they can legally tax it?

If you own land, chances are there is some sort of publicly sponsored feature in it or in place to protect it. Electrical lines. Gas lines. Sidewalk. Road. Fire protection. If you are going to pay taxes for things that affect your property, why should governments not tax that property to pay for it?

[A J]

18. Property taxes are considered more acceptable...

than Income taxes, historically speaking. Our founding fathers decided that the point of government was to protect our property, above anything else, So it makes sense that we would pay taxes based on the property we own. The more we have to protect means the more we pay the government.

Things have changed a lot since then... but property taxes remain a pretty progressive system for local governments.

[Name removed]

23. Deleted message

Message removed by moderator. Click here to review the message board rules.

[Serenity-NOW]

39. When you flush your toilet your property taxes make sure

that your 'property' doesn't cause problems and disease for everyone in your community. Those taxes also pay for local schools, fire/police/EMS and water treatement plants. Or would you prefer that all this was privatized so you could pay the money out to a private group and lose the ability to influence your own taxation?

The problem with taxation is not the taxes but how they are spent. Spending billions on 'Faith Based' programs serves only a fraction of those who have paid taxes for a national public school system, for example.

How come you leave all the states without income tax or sales tax out of your equation? Consider what happens if they quit collecting sales tax.

Libertarianism is a nice pipe dream if you don't have kids, cars, toilets and sewer, crime or the desire for and educated populace.

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[JHB]

32. Its a wealth tax or asset tax, on a particularly easy...

...-to-identify asset/form of wealth.

The government also enforces your claim of ownership and provides other services which enhance the value of your property.

By what rationale should it NOT be subject to tax?

[Superfly]

33. Out of 32 replies to this question

yours was the first succinct one that answered my question, at least partially.

Thanks a bunch.

[JHB]

42. Thanks, and sorry about the "rationale" quip...

As you've no doubt discovered, people in these parts are so accustomed to having to street-fight the Right about why taxes should be paid that the occasional honest question gets the "end of Butch and Sundance" treatment by mistake.

[Superfly]

43. Yeah, I've noticed.

My butt is missing about 3/4 from the instant ass chewings.

[MAlibdem]

34. The government has sovereignty over all the land in the country

Pretty much a rental fee.

[RichardRay]

40. How do you establish that it's yours?

You establish that through force of law or through force of arms. When there is no law force of arms is required and you get feudalism. Law is an instantiation of a social contract. It would be great if everyone had an inherent respect for the underlieing social contract. They don't, so we have a government to create laws and enforce them. We (supposedly) use a democracy to keep the government aligned with the social contact. In order to survive governments levy taxes.

QED

(edited for spelling)

[amazona]

44. where do you live?

People who have lots of property can use that property to create income. Also, in the U.S. there is little federal funding for schools so if there is no property tax in an area, there will be no money to pay the teachers or even maintain the school buildings.

I live in a homestead state (Louisiana) and people who own a home worth less than $75,000 do not pay property tax. Also, at age 65, you can register to freeze the value of your home, so you can live in your home the rest of your life without having to worry about finding the money for higher taxes. Home prices are admittedly quite low here, but I wonder why a similar system couldn't work everywhere, though a higher ceiling would be needed in places where a modest home is the $200K range or whatever.

People who are wealthy enough to have more expensive homes or who have multiple homes and pieces of property do pay property tax. They are getting more back from society, so they should pay more. Keeping kids in school, keeping roads maintained, paying the police -- all this protects their property value and generally means that they get many tens if not hundreds of thousands more back in increased property value than they would get if they didn't have property tax.

Seems like a win/win to me.

I agree that a very modest home should not be taxed. Society is more stable if low income people and retirees can keep their own homes.

Every state is different so please feel free to share your issues about your property tax.

Nothing is 100 percent yours. The public builds the roads, provides the schools to (at least semi) civilize the kids and keep them from destroying your property, provides the police and fire departments, etc. So we all have a responsibility to contribute where we can.

If you have a piece of raw land that is being taxed to high and that you feel to be without value, let it go back to the state. That's what everyone else does. Shrug...

[Nadienne]

46. Property value

Depending on what type of land you own (a farming acreage or a plot in a city). I think that's part of it...

[forgethell]

47. The purpose of property tax

is to raise revenue. Do you have a problem with that? How else can we support the public school system than by taxes? Generally property taxes are used for school systems, at least where I live. Everything the government does costs and has to be paid for.

The rationale is that 'wealth' should be taxed, not just 'income'. I'm not an economist, so while I understand the difference myself, I am not going to undertake to explain it. But how else to pry the money loose from the Scrooges that just want to sit on it?

My own pet peeve is the income tax, not just because it takes more than I can comfortably spare, but because that damned thing is too complicated. I spend at least two full weekends doing it,and mine is not complicated enough to take to an accountant.

[7 Lazy P]

48. In rural Pennsylvania

You might get as many as three property tax bills:

One from you local school district (they have the power to levy taxes for funding)

One from your county

One from your Incorporated municipality, if you live in one.

There are several opportunities for abuse of the system in PA for those willing to look. For example, I've enrolled our farm in the "Clean and Green" program. In exchange for developing less than 10% of the total acreage in a year, we get taxed at it's agricultural value rather than it's residential value. The theory being that you get a tax break for preserving farmland, stopping sprawl, etc. It saves me about 60% on my tax bill each year. Developers have figured out that they can do this with property they acquire with the full intention of developing in the future. They pay the lower tax rate while waiting for the property to appreciate in value. Others have figured out that if they buy enough acreage to qualify for the program and build their dream house or vacation home on it, they will also pay the lower rate, removing more property from the tax rolls. These costs are always passed along in higher taxes for those who do not have enough property to qualify for the lower agricultural tax rate.

Another problem is the equity factor. Is it right that I pay less in total property taxes on 95 acres than some guy with a house on 1 acre? I think the original intention of the program was good (kind of like the Govt. paying me not to grow corn) but it is too easy to take advantage of.

[geniph]

52. Most of the time, it actually isn't yours

the building is, and the first couple feet of the ground it sits on, but generally anything much belowground including the water table, mineral rights, etc., are retained by whoever platted the lots in the first place. For example, my property, which was first platted around the beginning of the 20th century, still cedes all mineral rights to Weyerhaeuser.

Have you a better solution to financing things like parks, schools, prisons, roads, national defense, firefighters, postal services, care of the elderly, etc.? If so, let's hear it - I mean, nobody loves property taxes. Nobody loves any taxes, but I prefer the services my taxes buy. I would, in fact, be quite willing to pay a higher percentage in taxes if it would guarantee medical care for every citizen and a more equal public education for everyone.

[trof]

53. You have struck a nerve.

<pulls out soapbox>
I believe taxing one's domicile should be made unconstitutional. Commercial land and improvements, used in business, for profit, is another matter.
But a man's home should be his castle. Unassailable by government tax collectors.

I'm OK with an income tax. I might even go for a national sales tax on other than basic food, clothing, health services, and prescription drugs.
When times are good, and I'm doing well, the government makes out. When I'm out of work, or underemployed, and have to tighten MY belt, so should the government.

Case in point: My real estate tax in New Hampshire was $6000 annually. They have NO sales or income tax, so the homeowner REALLY takes it in the shorts.
I was laid off from my $60,000+ job and had to take one at $18,000. My real estate taxes did not drop one nickel.

A tax on your home means that you can NEVER really own it. The mortgage can be paid off, there are no outstanding liens, and still, you must pay "rent' to the government for the privilege of living in it.

[Snow]

54. So how do you pay for the things covered by property tax?

because that's what the local government is allowed to collect. If you take that away from the towns and counties, what you end up with is California, where the counties have to go, hat in hand, to the state, where the rural legislators can really get going good on the anti-city demagogery. I lived in an area for a couple of years in the mid-1970's that was quite poor, most of the land was owned by coal companies who variously evaded the land taxes, and the locals had a dislike for even paying the modest amount that their property would've been taxed. Understandable, of course, but their high school had unreliable, often no, heat in the winter, and they still had outhouses which they still used - at the public county high school!.

[trof]

55. Well, I guess

the same way you pay for things NOT paid for by property tax.
Income taxes, sales taxes, business profits taxes, what ever their devious little mind can come up with. Hey, let's put a $500/pack tax on cigarettes. That always works.

If I'm paying $18,000 in taxes, I'd rather it all come from my income or buying habits. I want to be able to hunker down in my little piece of dirt and not pay anyone (who didn't lend me money so I could be here) to let me stay.

Now that I am retired, and know the FULL meaning of "limited income", It's more important than ever.

It'll never happen, I know. But it's the way it should be.

[Snow]

56. But trof, what the original poster & you seem to have missed,

or maybe I'm totally misinformed, is that while various levels of government have certain defined responsibilities, those levels also have limitations on the types of taxes they can levy. I like supporting my local schools a hell of a lot better than I like paying for the Air Force's latest toy, so I guess I like property tax a lot better than income tax, but only because of where the money goes. And you will agree that sales tax unfairly burdens the poor, unless you really put some limits on it? Property is probably one of the more progressive taxes around, except that by now the rich have probably hacked it, ie found all the ways to avoid it.

[John BigBootay]

58. It occurs to me that you might have a point--

Perhaps a one time only "sales" tax should apply to the transaction itself. But taxes in perpetuity do, in fact, seem regressive and contrary to our system. I

n fact many people do lose their homes or land because of an inability to pay the yearly taxes.

Perhaps usage fees should be assessed instead of property taxation to pay for services such as road maintenance, fire, schools etc.

Bottom line-- the money's going to come from somewhere-- unless we actually lower the costs of these services.

[coyotefish]

59. Property taxes actually...

... help to make your property worth more. Whatever it is you own, unless it is 40 acres in the middle of nowhere, it is dependent on an infrastructure of roads, sewers, schools, police and fire protection, etc.

Communities with better roads, schools, low crime rates, for example, tend to have higher property values than those that don't. The identical same house in two different locations may vary wildly in valuation because of the desirability of the property, which is in part dependent on this infrastructure.

If your community pays for these things solely with sales taxes, and like most communities, most of those paying the sales taxes don't own property, then you have benefited from the labors of others to keep your property safer and more valuable.

This is not socialist drivel, just basic economics. From the standpoint of a renter in such a community, they've just given you a free ride, because their taxes have made your property more valuable with no benefit to them. Their rental doesn't appreciate. If they have kids, they may benefit from schools paid for with their sales taxes, but some portion of those taxes still goes to make what you have stay valuable.

If you wish to benefit from these things, then I fail to see why you shouldn't pay "property taxes" - which are really taxes to help support the infrastructure upon which your property depends and derives value. I suppose they should be called "infrastructure taxes".

Most communities have some mix of taxation, some of which are regressive and some of which are progressive. This helps to distribute the burden of providing community services more fairly, so that they are not solely the responsibility of property owners.

The key word here is community. I have to assume that you are part of community (city, town, village, county) or you wouldn't be paying taxes. While your property may be 100% yours, it doesn't exist in isolation - it is part of something bigger that gives it value.

You are also part of a entity called the United States of America. Your federal, state and local taxes help keep you free and in a place where the system of government more or less protects you as an individual and gives your piece of the pie more value.

A little thought experiment - plunk your house down in Kabul or Chechnya and see how much it is worth and for how long.

Do I pay pay property taxes? You bet! My tax dollars help make where I live a safer, better place. Taxes are an investment in the community that pays off very nicely for most property owners, and should not be regarded as a burden or an evil.

And you know something? I like living in a safer, cleaner, better place. Every year my house increases its worth by far more than I pay in taxes. Why? Because we have good streets and police and fire and services, thereby making it more desirable a place to live.

There ain't no such thing as free lunch...

[oneighty]

60. in the beginning

of our Republic property ownership reflected ability to "contribute" to the welfare of the country. Land owners had the money! Poor people had no money, no ability to pay. In time income was taxed in a progressive fashion. The more you made the more you paid. Soon even poor people were able to own property and were also taxed according to value of their property.

But property ownership to-day does not reflect ability to pay. The only fair tax is a progressive tax on income..ability to pay.

IMHO

180

Who cares what you think 180?

[arewethereyet]

64. its as good a thing as any to tax

and you can be assured that property owners have money and will pay it in a timely manner.

be happy, they used to come around and screw the women at will and daughters got deflowered by the local poohbah. all they want is money now and they rarely beat it out of you.