Do not let the lack of updates make you think this site is out of date. I have noticed that there are more and more calls in letters to the editor to eliminate the property tax. So my message might be finally taking hold or (more likely) others just see its inherent inequities and draw the same conclusion.

One of the biggest problems in getting this message into the heads of the average taxpayer is they assume the property tax's legitimacy or--worse--they see the need to eliminate it but figure it cannot be done and so conclude there is no point in trying.

How discouraging. Ideas are what have changed the course of history. They begin as an idea and then capture the imagination and heart of more and more people until they are integrated into the way they act and what they do.

It is no different here. To eliminate the property tax can easily be done if people would just change their mind that "it can't be done". There is nothing else stopping this from happening. There are no guns pointed at our heads. There is no "disappearing" of those advocating its end. There are no gulags people are exiled to. It is only their own defeatist attitude and thoughts that prevents this.

What about those who think it is a fair and equitable way to collect revenue to fund government? They are either willfully blind or simply do not care about fairness and equity in the taxing system.

It is not complicated. If fairness and equity are guiding principles, no amount of other pragmatic, dogmatic nor idiotic (ignoring the obvious) argumentation should be allowed to trump an ethical matter. And that is what this is. Are we a people who are guided by transcendent principles or not?

The absurdity of the Property Tax

Here is a letter to the editor I recently had published in the Press (after I had to pare it down to their max of 300 words). It was in response to an editorial by couple of our illustrious Trenton legislators (Sarlo and Singer) who were "helping" NJ property taxpayers with legislation meant to make sure someone was not wrongly paying $100 (or some other absurdly insignificant amount) less than their neighbor just because they challenged their assesment and the other did not.

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What would Trenton say to a proposal to invert the income tax table? That is, take the highest rates and apply them to the lowest income bracket and apply the lowest rates to the highest income earners. Sound absurd? It is. But it is exactly what the property tax does.

Take the $7,000 average PT being paid by four hypothetical home owners living on the same street in homes assessed at the same value.

Those earning $35,000 pay 20% of their income;
those earning $70,000 pay 10%;
earn $140K to pay only 5%;
be a retiree with $21K in fixed income and you pay a whopping 33%.
Lose your job and you are using your savings (a negative percent).

No other tax--especially of such a large amount--is required to be paid if either, one, there is no income or, two, if one chooses not to spend their money. The IRS does not knock on your door and say, "You paid $5,000 in income tax last year, so fork it over again now (even though you are not working)." Nor will you pay that $1,400 sales tax on that $20K car if you do not buy it. Nevertheless, if you own a home, you are required to fork over that tax which is the single largest or second largest tax a person pays at a rate of five to six times those greater means.

The example above does not having anyone paying any more tax than anyone else. But it does show how one taxpayer--the one with the least means and the greatest need for every penny they have--pays at a rate five to six times their neighbor (who, in the example, is not extrememly wealthy). In effect, they are subsidizing those at the top by paying a larger share based on ability to pay (the way the income tax works).

Is this fair? Can this be just? Obviously not.

So, this is the disparity Trenton should be concerned about, not that one person challenged their assesment and is paying maybe $100 less than their neighbor.

These legislators say they are concerned about fairness. They state that several times in their editorial. If they really were interested in tax equity, they would work to eliminate the PT, not tinker with it. Their efforts will do nothing to address the inhernent inequity of the PT.

Is bringing "tax equity" code for class warfare?

In a recent conversation with a N.J. senator, one reason given as to why eliminating the property tax and replacing it with an income tax cannot be done is that it could be construed or actually become class warfare. The concern is that the so-called rich would be unfairly targeted to pay more taxes than their fair share for no other reason than that they are rich. So, to legislate based on such motivation is not right and would be divisive.

If that were the case, I would agree. We should not unfairly target one class of people based simply on who they are or what they have. But this is not the case here. In fact, the reverse is what is the de facto situation in New Jersey.

The property tax is inherently skewed against middle, low and no income taxpayers. In actuality, in an ever-increasing degree, it inordinantly benefits those have the greater income.

In fact, the property tax system does exactly what the decryers of class warfare ostensibly are against: The property tax automatically causes those of a certain class to pay an unfair share of the tax burden. It targets those at the bottom. The less income you have, the greater percentage of that income goes to the property tax.

For example, the person with an income of $60,000 paying $6,000 in property taxes has an effective tax rate of ten percent. The person making $120,000 and paying $6,000 in property taxes has an effective rate of five percent. The person making $360,000 and paying the same $6,000 in property taxes is paying a measley TWO percent rate. Compare that with the retiree with $30,000 income who has an effective tax rate of TWENTY percent. That is ten times the so-called wealthy taxpayer.

There is already class warfare going on, and it is against those at the bottom, not those at the top. The demand for equity to be brought to the system is not based on some Marxist notion that the rich are inherently evil and automatically worthy of contempt. It is based on the biblical and basic American ideal of treating all equally and fairly, of not favoring one class of people over another. The property tax favors the wealthy at the expense of those less well off.

(I have not factored in how abuse of the farm assessment--something only possible for the wealthy--exacerbates the disparity even more; it is fodder for an entire post.)

We must put a stop to the class warfare against those least able to afford it.

End the Property Tax and restore fairness and equity to how we pay taxes.

The Ruse of Reform

The trumpets are blaring in Trenton. The so-called leaders of our state are congratulating themselves for a job well done. They have addressed the property tax issue in New Jersey.

One can only ask whether these people really believe themselves. If they do, they do not belong in Trenton. If they do not, they do not belong in Trenton. The corresponding question is whether the N.J. voter will continue their tendency to return these unscrupulous politicians to office in November? If the continual re-election of the Sharpe James and Wayne Bryants is any indication, sadly, the answer is yes. N.J. taxpayers keep getting what they vote for: Charlatans.

What has been overlooked by all sides in this vacuous effort is whether the property tax is a fair and equitable tax. It is not. It imputes ability to pay based on one’s neighbor’s ability (the so-called wealthy districts). It is structured so those with the least means pay at a rate of three times and more as those with the most. It cares not whether one has income or basic living needs met.

Here is an example of what Trenton deems fair: One taxpayer has a $50,000 income and a $6,000 tax bill. Another has $250,000 in income and a $12,000 tax bill. The first party pays 12% of their gross income in property taxes. The second pays 4.8% of income. The first has $44,000 left after paying property taxes, the second $238,000. Both will receive $1,200 in tax relief. But who really needs the relief here? According to Trenton, both. Common sense and fairness makes it clear our legislators have no sense of tax equity.

And there are others who would not stop at $250K. They think everyone, regardless of income level, deserves to receive relief. Relief from what? They claim it is unfair and unconstitutional. Fair? Where is the fairness in the property tax? There are many taxpayers who have far less than $50,000 in income who are even worse off. So why do those who are paying property taxes at one third the rate of those at the bottom deserve anything? They need to pay their fair share. We need to stop having the least able subsidize the most.

The scam of property tax relief will be ballyhooed by politicians and the media over the following month’s right up to the election. Regrettably, the demogoguery of telling voters a band aid is the equivalent of major surgery will work. At least long enough to get them two more years in Trenton. And N.J. will have allowed a truly historic opportunity to go by the boards.