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Why 5%? That's enough to very nearly double the recurring cost of my house (mortgage, insurance and taxes), which seems overly punitive. Does this get offset so

Why 5%? That's enough to very nearly double the recurring cost of my house (mortgage, insurance and taxes), which seems overly punitive. Does this get offset somewhere else? Looking at a few quick numbers from Google, just residential property alone would add 50% to current US tax revenues. I'm guessing that means we'd be in the ballpark of doubling Federal tax revenue. I guess that's not necessarily a bad thing, but how do you make sure that money actually goes to the things you listed instead of the military?

sokoloff 7y ago
It would likely halve the market value of property, causing a massive wave of strategic foreclosures and also mean the revenue would be more like 2.5% of current property valuation. It would also likely be a massive long-term boost to equity markets, though the transitional financial chaos would be a short-term drag.
- 0xffff2 7y ago
  It would cause a massive wave of something. The more I think about it, the more insane this idea sounds. If I'm renting and my landlord's costs double, is she going to double my rent? Even if you eased in the tax at something like 0.5% per year, this seems like it would result in an absolute bloodbath in which renters and mortgage holders get wiped out and the lucky few with large cash reserves and no property-backed debt buy up all the land at fire sale prices.
mcny 7y ago
> Why 5%? I need to make it high enough to 1. make home ownership expensive enough that people who own "too much" pay their fair share 2. to pay for the supplemental basic income that covers this high tax for a modest one bedroom unit so I don't end up killing people who are willing to scale down. I actually wanted it to be slightly higher than seven percent so you end up paying the sticker price of the house once every about ten years but that seemed a little too extreme.

sokoloff 7y ago

It would likely halve the market value of property, causing a massive wave of strategic foreclosures and also mean the revenue would be more like 2.5% of current property valuation. It would also likely be a massive long-term boost to equity markets, though the transitional financial chaos would be a short-term drag.

0xffff2 7y ago
It would cause a massive wave of something. The more I think about it, the more insane this idea sounds. If I'm renting and my landlord's costs double, is she going to double my rent? Even if you eased in the tax at something like 0.5% per year, this seems like it would result in an absolute bloodbath in which renters and mortgage holders get wiped out and the lucky few with large cash reserves and no property-backed debt buy up all the land at fire sale prices.

mcny 7y ago

> Why 5%? I need to make it high enough to 1. make home ownership expensive enough that people who own "too much" pay their fair share 2. to pay for the supplemental basic income that covers this high tax for a modest one bedroom unit so I don't end up killing people who are willing to scale down. I actually wanted it to be slightly higher than seven percent so you end up paying the sticker price of the house once every about ten years but that seemed a little too extreme.