7 ms·

"The program would be paid for with a state value-added tax of 10 percent on goods and services, with exemptions for (...)" VAT is such a PITA (I'm originally

by dpc_pw 7y ago

"The program would be paid for with a state value-added tax of 10 percent on goods and services, with exemptions for (...)" VAT is such a PITA (I'm originally European, so I know a thing or two about it). Tons of additional paperwork, plenty of room for fraud and cheating (like https://en.wikipedia.org/wiki/Missing_trader_fraud https://en.wikipedia.org/wiki/Missing_trader_fraud ). Just be honest about it, increase existing property taxes, which people already pay anyway and are naturally progressive and avoid creating complications. Also, I would start with lower amounts, and see what actually happens. And ... Why wouldn't every capable homeless person from all over US move to California if they would be paid to do it (and I can't imagine more forgiving weather for homelessness, anyway)?

daveyb 7y ago
Agreed, but sadly, I would expect a meaningful property tax increase to met with impenetrable resistance in CA. Property owners have a very large influence in the state.
- dpc_pw 7y ago
  I realize that, but it's still stupid. It's a tax. We'll pay it one way or another. I am planing to buy a house in CA, and it doesn't really matter to me that much if it's taken from me at the register, in the property tax or from my salary. So if you have take our money, just don't waste our time with VAT paperwork. The coming decade is truly going to be a shitshow. Redistribution pressions will grow as wealth inequality increases, and pension crisis is getting closer and closer.
  - pmoriarty 7y ago
    There are people who own property in California but don't live in California (and not even in the US sometimes). They wouldn't pay California VAT because they need not buy anything there. The people most affected by a California VAT would be California residents who can't afford to shop elsewhere... ie. the poor. Fortunately some necessities like food seem to be excluded from the VAT (at least in this iteration of the bill), but I'm still concerned that the poor will be unduly burdened by it, and not even get to benefit because they're probably already on Medi-Cal (California's Medicaid program) so they won't be eligible for the UBI unless they give up Medi-Cal.
    - lgats 7y ago
      Supposedly, unless you pay more than 10k in VAT per year, you would come out ahead
boznz 7y ago
Property tax would just be passed on to the renters wouldnt it?
- fountainofage 7y ago
  Renters pay market rate for rent. If the landlords can pass on 100% of the property tax, then the supply is way out of sync with the demand.
  - deleted 7y ago
    [deleted]
  - ketzo 7y ago
    > “Supply is way out of sync with the demand” Welcome to California.
  - mrep 7y ago
    What? How? If the renter is paying less than the property tax, then the owner is losing money just on the property alone and not accounting for the likely mortgage payments. Nobody would ever rent out a place if that was the case.
    - fountainofage 7y ago
      First of all, no one said renters are paying less than property tax? But even if they were, it's still the same logic. That's just the law of supply and demand. Renters pay the market rate. If an owner can't afford to rent at that market rate, then as you noted, they go out of the renting business. You'll find if you run the numbers on properties in SF, landlords are banking on property appreciation. The market rents don't pay the ownership costs, usually by a huge margin.
      - mrep 7y ago
        > First of all, no one said renters are paying less than property tax? You just said "If the landlords can pass on 100% of the property tax, then the supply is way out of sync with the demand". For growing areas, why would any investor develop any land to increase housing supply to rent out if the property tax alone would cause them to lose money based on the money they could make renting out places?
daenz 7y ago
>And ... Why wouldn't every capable homeless person from all over US move to California if they would be paid to do it (and I can't imagine more forgiving weather for homelessness, anyway)? As someone from a non-CA city overrun with homeless, what's the problem here?
fountainofage 7y ago
I'm against Prop 13 more than anyone I know, but property tax (at least the way it is normally set up) is a regressive form of taxation. It's a flat rate regardless of circumstances, which is pretty much the definition of a regressive tax.
- quotemstr 7y ago
  Shouldn't some things not be adjusted for "circumstances"? Adjusting everything to individual ability to pay is tantamount to paying everyone the same amount. Why shouldn't you be able to pay for a more valuable parcel of land only if you earn more?
  - dragonwriter 7y ago
    > Shouldn't some things not be adjusted for "circumstances"? Yes, lots of things. But taxes aren't one of them.
    - kick 7y ago
      Why not property taxes in particular? Disincentivising land ownership would promote growth and lead more people to population centers, which seems like one of the only effective ways to solve many of the world's problems, from climate change to lack of opportunity. Not snark, I'm really curious as to your view.
  - fountainofage 7y ago
    I'm not really advocating one way or the other, just pointing out that property taxes are usually constructed such that the owner pays a flat rate based on an assessed value. There is no tiered increases in rates as the value goes up, so it's pretty much a classic example of a regressive tax.
basementcat 7y ago
How about repealing Prop 13 and using the proceeds to fund UBI? The landlords essentially get their money back through increased rents.

by dpc_pw 7y ago

daveyb 7y ago

Agreed, but sadly, I would expect a meaningful property tax increase to met with impenetrable resistance in CA. Property owners have a very large influence in the state.

dpc_pw 7y ago
I realize that, but it's still stupid. It's a tax. We'll pay it one way or another. I am planing to buy a house in CA, and it doesn't really matter to me that much if it's taken from me at the register, in the property tax or from my salary. So if you have take our money, just don't waste our time with VAT paperwork. The coming decade is truly going to be a shitshow. Redistribution pressions will grow as wealth inequality increases, and pension crisis is getting closer and closer.
- pmoriarty 7y ago
  There are people who own property in California but don't live in California (and not even in the US sometimes). They wouldn't pay California VAT because they need not buy anything there. The people most affected by a California VAT would be California residents who can't afford to shop elsewhere... ie. the poor. Fortunately some necessities like food seem to be excluded from the VAT (at least in this iteration of the bill), but I'm still concerned that the poor will be unduly burdened by it, and not even get to benefit because they're probably already on Medi-Cal (California's Medicaid program) so they won't be eligible for the UBI unless they give up Medi-Cal.
  - lgats 7y ago
    Supposedly, unless you pay more than 10k in VAT per year, you would come out ahead

boznz 7y ago

Property tax would just be passed on to the renters wouldnt it?

fountainofage 7y ago
Renters pay market rate for rent. If the landlords can pass on 100% of the property tax, then the supply is way out of sync with the demand.
- deleted 7y ago
  [deleted]
- ketzo 7y ago
  > “Supply is way out of sync with the demand” Welcome to California.
- mrep 7y ago
  What? How? If the renter is paying less than the property tax, then the owner is losing money just on the property alone and not accounting for the likely mortgage payments. Nobody would ever rent out a place if that was the case.
  - fountainofage 7y ago
    First of all, no one said renters are paying less than property tax? But even if they were, it's still the same logic. That's just the law of supply and demand. Renters pay the market rate. If an owner can't afford to rent at that market rate, then as you noted, they go out of the renting business. You'll find if you run the numbers on properties in SF, landlords are banking on property appreciation. The market rents don't pay the ownership costs, usually by a huge margin.
    - mrep 7y ago
      > First of all, no one said renters are paying less than property tax? You just said "If the landlords can pass on 100% of the property tax, then the supply is way out of sync with the demand". For growing areas, why would any investor develop any land to increase housing supply to rent out if the property tax alone would cause them to lose money based on the money they could make renting out places?

daenz 7y ago

>And ... Why wouldn't every capable homeless person from all over US move to California if they would be paid to do it (and I can't imagine more forgiving weather for homelessness, anyway)? As someone from a non-CA city overrun with homeless, what's the problem here?

fountainofage 7y ago

I'm against Prop 13 more than anyone I know, but property tax (at least the way it is normally set up) is a regressive form of taxation. It's a flat rate regardless of circumstances, which is pretty much the definition of a regressive tax.

quotemstr 7y ago
Shouldn't some things not be adjusted for "circumstances"? Adjusting everything to individual ability to pay is tantamount to paying everyone the same amount. Why shouldn't you be able to pay for a more valuable parcel of land only if you earn more?
- dragonwriter 7y ago
  > Shouldn't some things not be adjusted for "circumstances"? Yes, lots of things. But taxes aren't one of them.
  - kick 7y ago
    Why not property taxes in particular? Disincentivising land ownership would promote growth and lead more people to population centers, which seems like one of the only effective ways to solve many of the world's problems, from climate change to lack of opportunity. Not snark, I'm really curious as to your view.
- fountainofage 7y ago
  I'm not really advocating one way or the other, just pointing out that property taxes are usually constructed such that the owner pays a flat rate based on an assessed value. There is no tiered increases in rates as the value goes up, so it's pretty much a classic example of a regressive tax.

basementcat 7y ago

How about repealing Prop 13 and using the proceeds to fund UBI? The landlords essentially get their money back through increased rents.