In Higher Taxes Wouldn’t End Some Deficits (Jan 20) the New York Times reported how a few state governors have timidly proposed small income tax increases. There’s a better alternative: undo the legal shackles that keep residents of towns or school districts from voting themselves higher property taxes.
Property taxes are wealth taxes, intrinsically more progressive than income taxes—because personal and corporate property ownership is much less equal than income. Until World War II, property taxes were the dominant tax in the US. Since then they have been constricted by caps—notoriously Proposition 13 in California in 1978—and whittled down by exemptions and favors for influential owners. New York State’s constitution already limits property taxes to 2% of real value; Governor Cuomo proposes a further cap. Still, in an age of income tax loopholes, property taxes remain the only tax many rich people and corporations pay.
Yes, property taxes are unpopular. So are sales and income taxes—yet states don’t forbid localities to vote for an increase. In the name of democracy and fiscal sanity, let’s free our citizens to tax property for the services they need.
