Quote:
Originally Posted by sjuser23
Consumption taxes don't take income into consideration. Everyone pays the same rate like HST or amount, like gas taxes. Property taxes could be similar, each person or lot consumes the same resources so why not? Again, don't you think it could encourage development if you didn't have to pay more for developing your own property?
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They essentially do take income into account, because if you're poor you're going to spend a couple of hundred dollars for a tv instead of a couple of thousand, and you're going to take the bus or drive a pos instead of driving a brand new SUV. Although the %'age is the same, the rich end up consuming a lot more than the poor, and thus pay more consumption tax in terms of $'s and cents.
I don't think property tax escalation has much to do with prohibiting development in the grand scheme of things. If I want to dish out $30k for a garage for example, frankly it's the $30k I'm worried about, and the extra $360 a year taxes aren't even a consideration.
I think your proposal would drastically affect first time home owners. An extra thousand or two a year to someone trying to get out of an apartment and into their first home is a lot of money. An extra thousand or two a year for someone who has the extra wealth to upgrade from a $300k home to a $500k home is relatively nothing. I think a lot of development is driven by first time homeowners - both for developing new stock, as well as providing buyers for people upgrading. I really think if you hindered first time home owners by having the same amount of tax on a starter home as versus a mansion, it would really drive housing starts down dramatically.