Thursday, February 10, 2011

The Truth About Property Tax

This is a message I sent out while a candidate for state senate in Georgia. I oppose all wealth redistribution and unlawful government. This short article is designed to move our thinking in the direction of limited, lawful government. I see a few edits I could make, but I want to send the text exactly as written when I was a candidate for office.

The Truth About Property Tax

Before we begin, let me be perfectly clear that I will work hard to see that our counties, cities and schools are properly funded. However, it is my belief that we can fund government without violating the rights of our citizens.

Property Tax

Property tax makes us Renters, not Owners.

What we call property tax, the Communist Manifesto calls rent. The first plank of the Communist Manifesto says there shall be: "Abolition of property in land and the application of all rents of land to public purposes."

If we study closely we find that property tax is really an indirect consumption tax.

Let's think about how this works.

What is the reason that government relies so heavily on property tax?

It is because they can tag the tax bill to the property. If you don't pay, you lose your property.

That reminds me of one of my favorite George Washington quotes. "Government is not reason. It is not eloquence. It is force. Like fire, government is a dangerous servant and a fearful master."

Example:

Consider an elderly lady who is living on a fixed income with declining purchasing power. Each year the choice between food, energy (for heating and cooling), medication and property tax become more challenging.

There comes a time when she cannot afford everything and property tax is the first thing to go.

Our government, which is charged with defending the Life, Liberty and Property of Georgians, will take her property.

She will be moved to an assisted living home that she cannot afford, which means the taxpayers will pay the difference. The bill to taxpayers will be more each year than if we simply paid her property tax and let her keep her home.

What will happen to the property?

The government will sell the property on the courthouse steps. Someone who has the cash to purchase the land and pay the government rent, in the form of property tax, will now own the land.

Where does the cash come from?

The cash for property tax will come from people who are active in the marketplace, especially in the centers of business like the larger cities.

So what have we really done?

1. We steal the home of an elderly lady or at least force her to sell her home against her will.

2. We spend more on professional services for her in an assisted living home each year than the tax bill.

3. The property is sold to an active business person at a discount. Instant profit.

4. The business person's cash comes from business conducted in the larger cities where the consumption tax should be collected.

5. We have indirectly collected a consumption tax from that business person by selling the land at a discount to someone who can afford to pay the government rent in the form of property tax.

Why not simply collect a consumption tax to begin with and let the people keep their property?

To our shame, if there is anything government is good at, it would have to be wealth redistribution.

We can use a consumption tax to fund our local governments without violating the rights of our citizens.

Tax Equity

Some will complain that sending Gwinnett County or Clarke County or Cobb County taxes to rural counties is unfair.

I do enjoy that conversation. If we are going to talk tax equity, can we discuss restoring the family homes and family farms that have been taken away and broken up by declining real prices for agricultural products, rising property tax burdens and the destructive death tax?

That tends to end the conversation about tax equity.

Simple First Step Solution

Our property tax bill is set by millage multiplied by the assessed value of the property. We need to add one more element.

We need to set a cap on the property tax remitted by declaring that no person's property tax remittance can exceed 2% of their after tax income.

Of course the government officials will say that will deprive them of tax revenue. But think about what that means.

The argument becomes, if grandma can't pay because she doesn't have enough cash, that is her problem, not the government's problem. Cough up the cash or give up the property. It doesn't matter that you and your family worked for a lifetime to pay for it.

The government gets their money and then she goes into a retirement home that costs the taxpayers more than if we simply found another way to cover her property tax.

We could simply raise the revenue through a consumption tax or cut government spending.

I like the second option best.

Much More Could Be Said

There are many more details we could cover on this subject, but this outline is only intended to set the stage for a wise battle against the abuses of property taxes and death taxes.

Shane Coley

Please vote Coley for Liberty August 10th.

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