The European Tribune is a forum for thoughtful dialogue of European and international issues. You are invited to post comments and your own articles.
Please REGISTER to post.
You dismiss this with some hand-waving about lowering other taxes to compensate.
First, that won't work. The reason real estate taxes are less upwardly flexible than other taxes is that they make real estate lose value as mortgage collateral. If you make a revenue-neutral shift in the tax share from income to real estate, real estate prices are going to drop. Which may cause homeowners to become insolvent even though they are still able to make their monthly payments.
And second, even if it did work, it would build a general tax-cut bias into your political economy, because every time a wingnut government lowered taxes on real estate, the next responsible government would have to limit itself to revenue-neutral tax reforms in order to prevent a housing panic. Over a full cycle, this causes a net drop in tax rates. Thus, a built-in tax-cut bias.
Friends come and go. Enemies accumulate.
by Frank Schnittger - May 23 13 comments
by gmoke - May 19 2 comments
by redstar - May 12 18 comments
by redstar - May 14 14 comments
by redstar - May 6 50 comments
by Luis de Sousa - May 1 13 comments
by talos - Apr 29 49 comments
by In Wales - May 3 1 comment
by Frank Schnittger - May 2313 comments
by gmoke - May 192 comments
by redstar - May 1414 comments
by redstar - May 1218 comments
by redstar - May 650 comments
by In Wales - May 31 comment
by Luis de Sousa - May 113 comments
by gmoke - Apr 292 comments
by talos - Apr 2949 comments
by ManfromMiddletown - Apr 245 comments
by afew - Apr 2056 comments