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Wouldn't the self-assessed tax lead to unfair competitive practices? Imagine a small bookstore opening in the same town as a Barnes and Noble. What if there's n

Wouldn't the self-assessed tax lead to unfair competitive practices? Imagine a small bookstore opening in the same town as a Barnes and Noble. What if there's no tax level that the small store can afford that prevents a mega-corp like B&N from buying out their property? Imagine you live in a neighborhood with deep community or family ties. Someone down the street wins the lottery/makes an 8-figure exit and wants to buy out the block for a mega mansion. Can tax rates be low enough for you to raise your own valuation to "defend" your middle class home against vast wealth? What does that do to local government revenues? The very rich regularly spend $15m or more on a home. If Jeff Bezos came by my house and decided he liked the view, I would have to start paying $300k in taxes or move (if 2% tax). I get that making $15m for my house would make me rich, but this is our first home as a family and all our memories are here. I shouldn't be forced to choose like that - protection from arbitrarily being forced out of my home is one of the main reasons to own a home in the first place.

dpc_pw 8y ago
> What if there's no tax level that the small store can afford that prevents a mega-corp like B&N from buying out their property? Be bookstore owner. Set the value to be twice as much as comparable neighbor property. Get bought by B&N. Buy property next to you, move your books, pocket the difference. > I get that making $15m for my house would make me rich, but this is our first home as a family and all our memories are here. Price it accordingly. :) Yes, the whole idea is that the tax is much lower (1% maybe) than the value of the land. Also, some regulations might be added, that eg. a person who got forcefully bought-out, has a year or two to move out, just to make it less convenient to use it "aggressively", while allowing wise long-term investments.
- frgtpsswrdlame 8y ago
  >Price it accordingly. :) I don't see this as very helpful. The above poster views their home as something to protect from the market. It is a safehaven for family and friends and community connections, it is something that holds all the most important things in life and so it is above market mechanisms to the extent possible. Seeing this and purposefully advocating a system which forces them to put an actual price on their family memories supposes that there should be zero aspects of our life which are safe from market mechanisms. That seems like an impoverished way of looking at life.
glifchits 8y ago
I think the property/personal home example is hard to defend. Consider industrial property, such as a factory or warehouse. The most reasonable application of self-assessed tax would be to any property that can be valued on purely economic/objective bases.
- zimablue 8y ago
  I think the biggest problem with it, even with industrial stuff, is that it's ignoring transaction costs of moving buildings? Eg. I buy a property that I want to use as a factory. Some people who work for me move their own accomodation to be close to my factory. I spend absolutely tons of time and money filling my factory with machines, some of which are bolted to walls or have to be constructed inside the warehouse. The price I'm willing to accept for this property isn't the price of the property, it's the cost to me of moving all my people and goods and rebuilding things. Plus the cost of the interruption to my production flow etc. Caveat I know nothing about manufacturing but the point is more general, property isn't even close to fungible. Tesla wouldn't sell their hyperfactory thing for the price they bought it for! Everyone would be overpaying tax to the extent that their reliance on property isn't fungible, I'm not sure what the implications of that are but property is so fundamental and so much money that they'd be huge.
  - icebraining 8y ago
    If everyone is overpaying tax, that's OK, you can just adjust the tax rate. I think the real issue is whether is promotes certain uses of land over others, and whether that's problematic.
    - zimablue 8y ago
      Exactly, that's what I meant but I should have emphasised it more. Everyone overpays, but they overpay in proportion to how sticky their business is to a specific property. It would take someone who knows more about commercial property to dissect what businesses would get destroyed by that.
  - glifchits 8y ago
csomar 8y ago
Not trying to sound an a--hole (maybe I do) but isn't this your problem? If you want something, then you gotta work or provide to have it. Why do you want society to go out of its way, and make laws to protect your "stuff". Now, if many people think alike then it could be beneficiary. Owning a piece of land is not really owning it. Not in the USA, and most of the world. You are having a "privilege" of using the land vs. paying some taxes. That being said I don't approve of home taxes in the US. The taxes should be applied equally on all citizens to provide the required amenities (roads, cables, sanitary, etc...) The money should go to maintain the relevant infrastructure. I'm not sure if the taxes you pay on your home value in the US goes to relevant infrastructure; or else (nor do I really care!)
- mlevental 8y ago
  ... do you think bezos is in the majority or this person (i.e. would society be "going out of its way" for him if it prevents someone like Bezos from being able to do what's described)
  - csomar 8y ago
    If his house price increases, then Bezos is the majority. A single person won't have any effect on the price of a certain region.

dpc_pw 8y ago

> What if there's no tax level that the small store can afford that prevents a mega-corp like B&N from buying out their property? Be bookstore owner. Set the value to be twice as much as comparable neighbor property. Get bought by B&N. Buy property next to you, move your books, pocket the difference. > I get that making $15m for my house would make me rich, but this is our first home as a family and all our memories are here. Price it accordingly. :) Yes, the whole idea is that the tax is much lower (1% maybe) than the value of the land. Also, some regulations might be added, that eg. a person who got forcefully bought-out, has a year or two to move out, just to make it less convenient to use it "aggressively", while allowing wise long-term investments.

frgtpsswrdlame 8y ago
>Price it accordingly. :) I don't see this as very helpful. The above poster views their home as something to protect from the market. It is a safehaven for family and friends and community connections, it is something that holds all the most important things in life and so it is above market mechanisms to the extent possible. Seeing this and purposefully advocating a system which forces them to put an actual price on their family memories supposes that there should be zero aspects of our life which are safe from market mechanisms. That seems like an impoverished way of looking at life.

glifchits 8y ago

I think the property/personal home example is hard to defend. Consider industrial property, such as a factory or warehouse. The most reasonable application of self-assessed tax would be to any property that can be valued on purely economic/objective bases.

zimablue 8y ago
I think the biggest problem with it, even with industrial stuff, is that it's ignoring transaction costs of moving buildings? Eg. I buy a property that I want to use as a factory. Some people who work for me move their own accomodation to be close to my factory. I spend absolutely tons of time and money filling my factory with machines, some of which are bolted to walls or have to be constructed inside the warehouse. The price I'm willing to accept for this property isn't the price of the property, it's the cost to me of moving all my people and goods and rebuilding things. Plus the cost of the interruption to my production flow etc. Caveat I know nothing about manufacturing but the point is more general, property isn't even close to fungible. Tesla wouldn't sell their hyperfactory thing for the price they bought it for! Everyone would be overpaying tax to the extent that their reliance on property isn't fungible, I'm not sure what the implications of that are but property is so fundamental and so much money that they'd be huge.
- icebraining 8y ago
  If everyone is overpaying tax, that's OK, you can just adjust the tax rate. I think the real issue is whether is promotes certain uses of land over others, and whether that's problematic.
  - zimablue 8y ago
    Exactly, that's what I meant but I should have emphasised it more. Everyone overpays, but they overpay in proportion to how sticky their business is to a specific property. It would take someone who knows more about commercial property to dissect what businesses would get destroyed by that.
- glifchits 8y ago

csomar 8y ago

Not trying to sound an a--hole (maybe I do) but isn't this your problem? If you want something, then you gotta work or provide to have it. Why do you want society to go out of its way, and make laws to protect your "stuff". Now, if many people think alike then it could be beneficiary. Owning a piece of land is not really owning it. Not in the USA, and most of the world. You are having a "privilege" of using the land vs. paying some taxes. That being said I don't approve of home taxes in the US. The taxes should be applied equally on all citizens to provide the required amenities (roads, cables, sanitary, etc...) The money should go to maintain the relevant infrastructure. I'm not sure if the taxes you pay on your home value in the US goes to relevant infrastructure; or else (nor do I really care!)

mlevental 8y ago
... do you think bezos is in the majority or this person (i.e. would society be "going out of its way" for him if it prevents someone like Bezos from being able to do what's described)
- csomar 8y ago
  If his house price increases, then Bezos is the majority. A single person won't have any effect on the price of a certain region.