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.
The problem is that if you raise real estate taxes on your residential owner-occupiers, a number of them becomes insolvent (because this tax is discounted in the market value).
If their mortgage goes underwater, it does not mean they are insolvent, if their other wealth increases. You cannot decide a household wealth only from the balance sheet of their mortgage. And anyway, this is an issue of politics. That is a very poor starting point for seeking remedies. Politics must follow policy, not the other way around.
Inasmuch as taxes crowd out amortisations, they don't matter to demand. Taxes destroy money, amortisation destroys money - either way, the money is destroyed.
No. This is the central point. Property tax destroys economic rent. Labour tax destroys wealth. A whole different thing.
Inasmuch as taxes crowd out interest payments, you reduce banker income, which ceteris paribus reduces demand.
It is not ceteris paribus at all. When banker incomes are economic rent (created interest charges over existing wealth, like land, real estate, shares etc.) these "incomes" are the actual "the beef" that destroy demand. This is exactly what property tax helps to get rid of.
by Oui - Apr 9
by Oui - Apr 12 4 comments
by Oui - Apr 8 22 comments
by Frank Schnittger - Mar 30 10 comments
by Oui - Apr 2
by Oui - Mar 14 33 comments
by Oui - Apr 171 comment
by Oui - Apr 17
by Cat - Apr 143 comments
by Cat - Apr 14
by Oui - Apr 124 comments
by Oui - Apr 10
by Oui - Apr 822 comments
by Cat - Apr 64 comments
by Oui - Apr 62 comments
by Oui - Apr 46 comments
by Oui - Apr 4
by Oui - Apr 3
by Oui - Apr 11 comment
by Oui - Mar 31
by Oui - Mar 304 comments
by Frank Schnittger - Mar 3010 comments
by Oui - Mar 293 comments
by Cat - Mar 2920 comments