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There is already land tax, but with proposition 13 people lock in low tax rates. So, if you've owned a home for a long time, you are gonna pay a lot lower taxes
by gersh 7y ago
There is already land tax, but with proposition 13 people lock in low tax rates. So, if you've owned a home for a long time, you are gonna pay a lot lower taxes than someone, who recently bought a condo on land with the same value.
- khuey 7y agoA land tax is different from a property tax. A land tax taxes only the unimproved land. A property tax taxes the improvements as well. With a land tax two adjacent properties of equal size would be taxed the same, even if one is an eight story apartment building and the other is a parking lot. This strongly incentivizes improving the land to its highest and best use. Under a traditional property tax system erecting that building results in a large increase in property tax (as the value of the structure is now taxed) which dampens the motivation to build. Under California's prop 13, the parking lot probably has a tax valuation from decades ago and thus is taxed even less, further reducing the benefits to redeveloping the property.
- gersh 7y agoThe land tax along with the house. Perhaps, you believe the land should be taxed more highly and the house should be taxed less. When permitting is tough, the fact that you got the permits to build the house should increase the value of the land. While the structure may be taxed, it also can generate revenue. If land value is a high percentage of the value, property tax should have similar incentives.