4 ms·

> They're not using services. Government services are not something that are "used" in the normal sense of the word. Central Park needs to get mowed, street l

> They're not using services. Government services are not something that are "used" in the normal sense of the word. Central Park needs to get mowed, street lights need to be lit, police and fire protection needs to be provided, etc. regardless of whether residents are there or not.

orourkek 14y ago
Given that the people in question are there for just days/weeks per year, their "use" of the services seems in line with the taxes they pay. Without knowing specific numbers it's hard to get exact math, but if someone pays property tax on a multi-million dollar condo purchase and is only in the city for 3 weeks per year, surely they aren't overusing the services?
- pyoung 14y ago
  If they can afford a crash pad in new york city, then a little extra in property taxes is probably not gonna break the bank. Another way to look at the issue, is to evaluate the 'tax collection opportunity costs' of the absentee owners. For every condo that gets bought by an absentee owner (as opposed to a local owner), NYC loses income tax, sales tax, and general economic activity (these are wealthy individuals, there spending is a boost to the local economy). By increasing the property taxes, NYC would shift the cost-benefit ratio towards those that are actually going to utilize the property (thus resulting in more income and sales taxes), while also bringing in more property taxes Finally, if these wealthy individuals were so concerned about only paying for what they "use", then it would make a lot more sense if they just got a nice hotel room for the days/weeks per year that they are in NYC, rather than buying a condo that sits empty most of the time.
  - greedo 14y ago
    The "probably not gonna break the bank meme" is how class warfare propagates; it offers nothing useful in terms of creating progressive and fair tax rates. And your hotel idea is exactly what will happen if property tax rates go up. Think through what the effects of that would be...
    - pyoung 14y ago
      "it offers nothing useful in terms of creating progressive and fair tax rates." Neither does accusing people of propagating class warfare.
- afterburner 14y ago
  Regardless of how long they're there, they still probably don't want NYC to burn down all year long, right?
stickfigure 14y ago
Forget looking at this from a moral perspective and try the utilitarian approach. It is not socially desirable to have underutilized real estate in a place as crowded as NYC. Put it this way: Renting out an empty space is effectively the equivalent of building a new space! I normally disapprove of using tax policy to modify behavior, but in this case it makes sense. Property tax is like the "rent" citizens pay to the government for using land. If the rent is too low, people overconsume the scarce resource.
- darkarmani 14y ago
  Doesn't property tax raise the rent for everyone?
  - stickfigure 14y ago
    Possibly. But so does underused real estate, by reducing supply. And housing is a fairly inelastic good, so even a 5-10% increase in supply could have a significant impact.
  - malandrew 14y ago
    They can just focus on really high tax rates for homes that aren't primary residences.
  - wisty 14y ago
    Not necessarily. Rent is decided by supply, and demand. Property taxes may encourage smaller homes, which increases supply (as you can build more of them); and demand won't change at all (since people will still spend 1/3rd of their income on rent, or more if they live in NY).
OGinparadise 14y ago
Government services are not something that are "used" in the normal sense of the word. Central Park needs to get mowed, street lights need to be lit, police and fire protection needs to be provided, etc. regardless of whether residents are there or not. Property taxes are relatively low but they do exist. So that billionaire is probably still paying for a cop or a Sanitation worker, even if he steps in NY once a year. NYC takes almost 4% in tax, in addition to what the NY (state) takes.

orourkek 14y ago

Given that the people in question are there for just days/weeks per year, their "use" of the services seems in line with the taxes they pay. Without knowing specific numbers it's hard to get exact math, but if someone pays property tax on a multi-million dollar condo purchase and is only in the city for 3 weeks per year, surely they aren't overusing the services?

pyoung 14y ago
If they can afford a crash pad in new york city, then a little extra in property taxes is probably not gonna break the bank. Another way to look at the issue, is to evaluate the 'tax collection opportunity costs' of the absentee owners. For every condo that gets bought by an absentee owner (as opposed to a local owner), NYC loses income tax, sales tax, and general economic activity (these are wealthy individuals, there spending is a boost to the local economy). By increasing the property taxes, NYC would shift the cost-benefit ratio towards those that are actually going to utilize the property (thus resulting in more income and sales taxes), while also bringing in more property taxes Finally, if these wealthy individuals were so concerned about only paying for what they "use", then it would make a lot more sense if they just got a nice hotel room for the days/weeks per year that they are in NYC, rather than buying a condo that sits empty most of the time.
- greedo 14y ago
  The "probably not gonna break the bank meme" is how class warfare propagates; it offers nothing useful in terms of creating progressive and fair tax rates. And your hotel idea is exactly what will happen if property tax rates go up. Think through what the effects of that would be...
  - pyoung 14y ago
    "it offers nothing useful in terms of creating progressive and fair tax rates." Neither does accusing people of propagating class warfare.
afterburner 14y ago
Regardless of how long they're there, they still probably don't want NYC to burn down all year long, right?

stickfigure 14y ago

Forget looking at this from a moral perspective and try the utilitarian approach. It is not socially desirable to have underutilized real estate in a place as crowded as NYC. Put it this way: Renting out an empty space is effectively the equivalent of building a new space! I normally disapprove of using tax policy to modify behavior, but in this case it makes sense. Property tax is like the "rent" citizens pay to the government for using land. If the rent is too low, people overconsume the scarce resource.

darkarmani 14y ago
Doesn't property tax raise the rent for everyone?
- stickfigure 14y ago
  Possibly. But so does underused real estate, by reducing supply. And housing is a fairly inelastic good, so even a 5-10% increase in supply could have a significant impact.
- malandrew 14y ago
  They can just focus on really high tax rates for homes that aren't primary residences.
- wisty 14y ago
  Not necessarily. Rent is decided by supply, and demand. Property taxes may encourage smaller homes, which increases supply (as you can build more of them); and demand won't change at all (since people will still spend 1/3rd of their income on rent, or more if they live in NY).

OGinparadise 14y ago

Government services are not something that are "used" in the normal sense of the word. Central Park needs to get mowed, street lights need to be lit, police and fire protection needs to be provided, etc. regardless of whether residents are there or not. Property taxes are relatively low but they do exist. So that billionaire is probably still paying for a cop or a Sanitation worker, even if he steps in NY once a year. NYC takes almost 4% in tax, in addition to what the NY (state) takes.