Too bad he did not win.
http://www.freerepublic.com/focus/f-news/615736/posts
Monday, December 11, 2006
Tuesday, November 21, 2006
Across the board advocates just do not get it
Can anyone tell me why it is more important to grant across the board property tax reductions to all taxpayers than to maximize the relief given to those most severely affected?
It would be nice to give everyone a tax break. But to say it is imperitive to give a 10% property tax reduction to someone earning $150,000 while limiting the reduction to 20% for those making $25,000 reveals the utterly oblivious understanding those proponents have of the real issue here.
If these people understood the concept of tax justice as the issue, they would be not be suggesting distributing the limited money available to those in least need of it. They seem to fail to remotely understand that equity and fairness are even an issue, let alone the issue.
Those in the bottom 20% of taxpayers pay almost triple the percent of their income in property taxes as compared to the top 20%. This fact proves there is an inherent inequity built into the property tax. Across the board reductions will not change that formula. Therefore, addressing that inequity must be the starting point in dealing with the property tax issue.
It is obvious that the only way to deal with bringing true relief to those in most dire need of it is to find an alternative to the property tax. Pumping money in without dealing with its structurally built in bias against low and no income taxpayers will only result in superficial and quickly passing relief.
It would be nice to give everyone a tax break. But to say it is imperitive to give a 10% property tax reduction to someone earning $150,000 while limiting the reduction to 20% for those making $25,000 reveals the utterly oblivious understanding those proponents have of the real issue here.
If these people understood the concept of tax justice as the issue, they would be not be suggesting distributing the limited money available to those in least need of it. They seem to fail to remotely understand that equity and fairness are even an issue, let alone the issue.
Those in the bottom 20% of taxpayers pay almost triple the percent of their income in property taxes as compared to the top 20%. This fact proves there is an inherent inequity built into the property tax. Across the board reductions will not change that formula. Therefore, addressing that inequity must be the starting point in dealing with the property tax issue.
It is obvious that the only way to deal with bringing true relief to those in most dire need of it is to find an alternative to the property tax. Pumping money in without dealing with its structurally built in bias against low and no income taxpayers will only result in superficial and quickly passing relief.
Wednesday, November 08, 2006
Leading the way...to being broke
Leading the way but not to something good.
A recent study for 2005 has revealed that six of the top ten counties in the nation (yes, the nation) with the highest property taxes are in New Jersey.
Hunterdon, Bergen, and Essex are in the top five. Morris, Somerset and Union are 7th, 8th and 10th.
I feel better. My county, Monmouth, is all the way down at 13th. Woo hoo.
Meanwhile, neither Pennsylvania, Delaware, North Carolina, South Carolina, Florida nor Arizona have a single county in the top fifty.
Can there really be any wonder why there is an exodus from N.J. to these states?
A recent study for 2005 has revealed that six of the top ten counties in the nation (yes, the nation) with the highest property taxes are in New Jersey.
Hunterdon, Bergen, and Essex are in the top five. Morris, Somerset and Union are 7th, 8th and 10th.
I feel better. My county, Monmouth, is all the way down at 13th. Woo hoo.
Meanwhile, neither Pennsylvania, Delaware, North Carolina, South Carolina, Florida nor Arizona have a single county in the top fifty.
Can there really be any wonder why there is an exodus from N.J. to these states?
The Asbury Park Press misguided
Here is my most recent letter to the APP.
The Press has done a nice job of keeping the property tax discussion under the microscope of public awareness. The taxpaying public owes it many thanks.
In its editorials, it has correctly analyzed the shortcomings and benefits of many of the cost savings proposals. It has tried to focus on state legislator’s efforts or lack thereof. It has rightly ruled out tax increases as a full or partial solution. What it has wrongly done is summarily rule out shifting of the tax burden.
The Press, along with most of the major players in this quest to fix the property tax dilemma, forgets the fundamental reason the outcry against property taxes has reached a crescendo. It is because they are unfair.
Everyone hates to pay taxes. But most are not averse to paying their fair share. But the property tax burden is inordinately skewed in favor of those with upper incomes and against those in lower brackets.
Shifting the tax burden so it is more equitably distributed is what we need to make the singular and major focus of this process. Efforts to find cost savings are also critical and a basic part of the solution. But bringing fairness to how government services are funded by taxpayers is a moral imperative of the first order.
Maintaining the status quo by ruling out shifting the present unfair property tax to a more broad-based tax such as the income tax precludes addressing the very essence of what our nation was founded for: Equal justice for all. The property tax is not just because it is not fair.
Visit my website dedicated to ending the property tax: http://EndPT.org
The Press has done a nice job of keeping the property tax discussion under the microscope of public awareness. The taxpaying public owes it many thanks.
In its editorials, it has correctly analyzed the shortcomings and benefits of many of the cost savings proposals. It has tried to focus on state legislator’s efforts or lack thereof. It has rightly ruled out tax increases as a full or partial solution. What it has wrongly done is summarily rule out shifting of the tax burden.
The Press, along with most of the major players in this quest to fix the property tax dilemma, forgets the fundamental reason the outcry against property taxes has reached a crescendo. It is because they are unfair.
Everyone hates to pay taxes. But most are not averse to paying their fair share. But the property tax burden is inordinately skewed in favor of those with upper incomes and against those in lower brackets.
Shifting the tax burden so it is more equitably distributed is what we need to make the singular and major focus of this process. Efforts to find cost savings are also critical and a basic part of the solution. But bringing fairness to how government services are funded by taxpayers is a moral imperative of the first order.
Maintaining the status quo by ruling out shifting the present unfair property tax to a more broad-based tax such as the income tax precludes addressing the very essence of what our nation was founded for: Equal justice for all. The property tax is not just because it is not fair.
Visit my website dedicated to ending the property tax: http://EndPT.org
Grand pre-opening preview
Visit my website dedicated to ending the property tax:
http://EndPT.org
It is not completely finished, so please forgive typos, grammar and any other errors.
http://EndPT.org
It is not completely finished, so please forgive typos, grammar and any other errors.
We have met the enemy and ....
The Cato Institute has done a study. It looks at how informed the voter really is.
We are in deep trouble. Platitudes and demogoguery work because we have a nation ruled by uninformed voters who do not take the time to think any deeper than a headline.
Follow the link to read the results. Try not to get too depressed.
http://www.cato.org/pub_display.php?pub_id=2372
We are in deep trouble. Platitudes and demogoguery work because we have a nation ruled by uninformed voters who do not take the time to think any deeper than a headline.
Follow the link to read the results. Try not to get too depressed.
http://www.cato.org/pub_display.php?pub_id=2372
Tuesday, October 03, 2006
Local Taxing Authority - the Right Way and the Wrong Way
Thank you to Thomas McMahon for giving us the fuller picture regarding supposed cost savings to be gained through consolidating local school districts (Asbury Park Press County school districts won’t assure cost savings, 10/3/06 http://www.app.com/apps/pbcs.dll/article?AID=/20061003/OPINION/610030306/1030). His article serves as a warning for us not to mindlessly accept over-simplified solutions to high property taxes. Politicians are so inclined to sound bites over substance and to then believing themselves that we are in jeopardy of not really getting anywhere than to the governor’s capitulation of a reduced rate of property tax increases.
Buying into insubstantial fixes like consolidation is also why we must not allow the latest proposal of allowing localities to impose there own taxes to go down the wrong road. Builder fees and local sales taxes are gaining traction, according to recent reporting. We must scrutinize these ideas.
Builder fees may add tax revenue but they have severe shortcomings. They are not reoccurring. Homes and offices are built once. Areas that are built out would have limited, short-term benefit. As for towns that are built out, just as they are driven to chase ratables so as to increase property tax revenue, the thirst for builder fees would encourage more unneeded development and, likely, further abuse of eminent domain. Those not built out would be encouraged to do so with a vengence as they also chase more tax revenue.
Local sales taxes are equally problematic. They do not ensure tax revenue would remain local. Who shops exclusively in their own town? In fact, towns with a mall would see a windfall at the expense of other towns. On the other hand, unless every locality enacts a sales tax, people would be encouraged to spend their money where there is no or lower sales taxes. This would in turn harm businesses in the shunned town or simply drive all towns to enact a local sales tax. What an unhelpful and confusing mess.
We ask would local sales taxes be mandated to offset dollar for dollar local property taxes? We all know how politicians find ways to spend additional income rather than using it to reduce taxes. Does anyone believe things will be any different this time? Even with a mandate offset, they will find ways around it.
The sales tax is regressive. It begins with the first dollar you spend. That is, it forces those at the bottom and least able to afford it to pay more taxes. There was a huge uproar over raising the state sales tax 1%. Will the arguments against doing that be any less applicable when there is a two, three or four percent local sales tax?
The idea of local taxing authority is good. The methods proposed are not. What needs to be implemented is a local income tax. And it ought to replace the local property tax. Local taxpayers’ taxes will then remain local.
More importantly, fundamental fairness will be brought to tax funding of local schools and government. With an income tax, those who are struggling to get by on fixed or reduced income will no longer be burdened with carrying an inordinate share of local taxes. It will also eliminate the inequity of the low income taxpayer being imputed with an ability to afford more taxes just because his neighbor’s income means he lives in a “rich” district.
Therefore, local taxing authority can be a solution to inequities in the property tax. But that will only be as long as it is restricted to an income tax. Other kinds of taxes are illusions, non-solutions or will only shift the tax burden from one unfair method to another.
Buying into insubstantial fixes like consolidation is also why we must not allow the latest proposal of allowing localities to impose there own taxes to go down the wrong road. Builder fees and local sales taxes are gaining traction, according to recent reporting. We must scrutinize these ideas.
Builder fees may add tax revenue but they have severe shortcomings. They are not reoccurring. Homes and offices are built once. Areas that are built out would have limited, short-term benefit. As for towns that are built out, just as they are driven to chase ratables so as to increase property tax revenue, the thirst for builder fees would encourage more unneeded development and, likely, further abuse of eminent domain. Those not built out would be encouraged to do so with a vengence as they also chase more tax revenue.
Local sales taxes are equally problematic. They do not ensure tax revenue would remain local. Who shops exclusively in their own town? In fact, towns with a mall would see a windfall at the expense of other towns. On the other hand, unless every locality enacts a sales tax, people would be encouraged to spend their money where there is no or lower sales taxes. This would in turn harm businesses in the shunned town or simply drive all towns to enact a local sales tax. What an unhelpful and confusing mess.
We ask would local sales taxes be mandated to offset dollar for dollar local property taxes? We all know how politicians find ways to spend additional income rather than using it to reduce taxes. Does anyone believe things will be any different this time? Even with a mandate offset, they will find ways around it.
The sales tax is regressive. It begins with the first dollar you spend. That is, it forces those at the bottom and least able to afford it to pay more taxes. There was a huge uproar over raising the state sales tax 1%. Will the arguments against doing that be any less applicable when there is a two, three or four percent local sales tax?
The idea of local taxing authority is good. The methods proposed are not. What needs to be implemented is a local income tax. And it ought to replace the local property tax. Local taxpayers’ taxes will then remain local.
More importantly, fundamental fairness will be brought to tax funding of local schools and government. With an income tax, those who are struggling to get by on fixed or reduced income will no longer be burdened with carrying an inordinate share of local taxes. It will also eliminate the inequity of the low income taxpayer being imputed with an ability to afford more taxes just because his neighbor’s income means he lives in a “rich” district.
Therefore, local taxing authority can be a solution to inequities in the property tax. But that will only be as long as it is restricted to an income tax. Other kinds of taxes are illusions, non-solutions or will only shift the tax burden from one unfair method to another.
Tuesday, August 29, 2006
Economists: Dismal scientists, to say the least.
There is an article in the 8/28/06 Asbury Park Press, New Jersey's not alone in its property tax revolt. http://www.app.com/apps/pbcs.dll/article?AID=/20060828/NEWS/608280356 Towards the end of the article, it says: "Economists generally like the property tax because it is stable, visible..." "Stable", yes, for it is not subject to the vagaries of the economy. But does that necessarily mean that there is no other tax as good to use as the Property Tax? If so, we ought to get rid of the Income Tax and the Sales Tax and replace them with the Property Tax. State tax revenues will be much more stable.
Dumb idea? Of course. But most do not see the speciousness of the point with the "stable" characterization. The state seems to get by fine without tax revenue sources as stable as property taxes. The only reason the state runs into revenue shortfalls is due to overspending. And even with that, they manage to get by year after year. We have yet to see Trenton close down before the end of the year due to being short on tax revenue.
The economists continue with their specious logic when they say the Property Tax "doesn't allow behavior such as tax dodging common on the income tax." So, they would like us to think property taxes are loophole free. Are these guys wearing blinders or are they are just shills for those tax dodgers?
The fact is that the lowest 20% income earners among property taxpayers pay almost 3 times--THREE TIMES--the percentage of their income in property taxes as do those at the other end of the income scale. This is a builtin loophole to the advantage of the well-off, for which to get they do not need tax attorneys, friends in the legislature or an accountant. What ever happened to paying one's fair share?
Furthermore, how many average taxpayers own five or more acres which they can have classified as "farm land" in order to get a 90% break on its assessment? All one needs to do is to conduct $500 worth of business each year. Hmmm, do you think they might have a well-off friend who would gladly buy a $500 cord of wood or bales of hay or whatever each year in return for the same? How could I be so cynical? Maybe because one only need take a spin down Navesink River Road to see a few steer in the yard of the riverfront home of one of those who supposedly cannot get a tax dodge on property taxes. Think the bovine are there just for next summer's bar-b-que?
The complete obliviousness and insensitivity of economists to the heinous and insidious nature of the Property Tax is made even clearer when they say: "The property tax is a fantastic tax for things that are purely local because, under those circumstances, it does not function like a tax. It's more like a user fee."
A "fantastic" tax? Are they out of their minds? Fantastic if you are wealthy. Devastating if you are on low, fixed or no income. Maybe they ought to take a poll at the border of NJ as retirees and others join the exodus to friendlier environs. Ask them how "fantastic" property taxes have been to them.
And "user fee?" Well, I have always said you do not really own your home but are just a renter from the state. Now this is confirmed by the economists. We are just users of our homes, not owners. We must pay for the privilege of living in the state's house and on their land. I guess communism actually did win the cold war (maybe they did not know they need not fight one). Or maybe it is just a revival of the Middle Ages when we had land barons and peasants who paid tribute in order to live on their land.
The problem here is that these misguided views of economists are not exclusive to them. There are many who hold to the same who are also the ones who are major players in the current property tax reform effort. Too bad we are advised and ruled by the foolish or willfully blind.
Until the Property Tax is eliminated, its oppression of those at the bottom will continue. And the only response we can expect from those at the top will be their wonder at why the protestors aren't just eating their cake.
Dumb idea? Of course. But most do not see the speciousness of the point with the "stable" characterization. The state seems to get by fine without tax revenue sources as stable as property taxes. The only reason the state runs into revenue shortfalls is due to overspending. And even with that, they manage to get by year after year. We have yet to see Trenton close down before the end of the year due to being short on tax revenue.
The economists continue with their specious logic when they say the Property Tax "doesn't allow behavior such as tax dodging common on the income tax." So, they would like us to think property taxes are loophole free. Are these guys wearing blinders or are they are just shills for those tax dodgers?
The fact is that the lowest 20% income earners among property taxpayers pay almost 3 times--THREE TIMES--the percentage of their income in property taxes as do those at the other end of the income scale. This is a builtin loophole to the advantage of the well-off, for which to get they do not need tax attorneys, friends in the legislature or an accountant. What ever happened to paying one's fair share?
Furthermore, how many average taxpayers own five or more acres which they can have classified as "farm land" in order to get a 90% break on its assessment? All one needs to do is to conduct $500 worth of business each year. Hmmm, do you think they might have a well-off friend who would gladly buy a $500 cord of wood or bales of hay or whatever each year in return for the same? How could I be so cynical? Maybe because one only need take a spin down Navesink River Road to see a few steer in the yard of the riverfront home of one of those who supposedly cannot get a tax dodge on property taxes. Think the bovine are there just for next summer's bar-b-que?
The complete obliviousness and insensitivity of economists to the heinous and insidious nature of the Property Tax is made even clearer when they say: "The property tax is a fantastic tax for things that are purely local because, under those circumstances, it does not function like a tax. It's more like a user fee."
A "fantastic" tax? Are they out of their minds? Fantastic if you are wealthy. Devastating if you are on low, fixed or no income. Maybe they ought to take a poll at the border of NJ as retirees and others join the exodus to friendlier environs. Ask them how "fantastic" property taxes have been to them.
And "user fee?" Well, I have always said you do not really own your home but are just a renter from the state. Now this is confirmed by the economists. We are just users of our homes, not owners. We must pay for the privilege of living in the state's house and on their land. I guess communism actually did win the cold war (maybe they did not know they need not fight one). Or maybe it is just a revival of the Middle Ages when we had land barons and peasants who paid tribute in order to live on their land.
The problem here is that these misguided views of economists are not exclusive to them. There are many who hold to the same who are also the ones who are major players in the current property tax reform effort. Too bad we are advised and ruled by the foolish or willfully blind.
Until the Property Tax is eliminated, its oppression of those at the bottom will continue. And the only response we can expect from those at the top will be their wonder at why the protestors aren't just eating their cake.
Wednesday, August 23, 2006
Appeal to get discussion on right basis
Following is an appeal I made to a Gannett reporter. I requested that the property tax discussion be given some balance as to its fundamental context. The idea is that individuals pay taxes regardless of who or how rich their neighbor is.
________________________________________
Read your article in today's Press about lawmakers wanting to cap spending in so-called rich districts.
Let me suggest that you and Gannett expose this misleading idea that there are "rich" and "poor" districts. The characterization would be true if there were only rich or only poor people living in those districts. The reality is there are an entire range of incomes represented in each. Individuals pay taxes by themselves. Their rich neighbor has nothing to do with that ability.
I live in Middletown where we receive state aid toward education in the upper teens as a percent of the total budget. Middletown has one of the better per pupil costs. Nothing near the Abbotts or other high-spending districts. We receive so little aid because we have a lot of wealthy residents. But I have yet to receive anything from them to help me pay my property taxes.
As you know, Middletown borders Keansburg, an Abbott district. I am not sure how much they receive from Trenton as a percent of their total education budget, but it certainly must exceed 60%. They are a "poor" district.
My suggestion for your reporting is that you could choose a street or block that acts as a border between the two towns. They will have similar sized and valued homes. The people who live in them will likely be in similar income brackets. BUT because one lives in Middletown and the other in Keansburg, they are each imputed with a different ability to shoulder the cost of local education spending. Obviously, they do not have differing abilities. But the state designates each district's ability to afford based on an average of the aggregate income, regardless of the range of incomes. Just because Keansburg does not have a Navesink River Road or a Locust (among other) areas, it has a lower average income, a lower "wealth" factor.
You can see how this is unfair and totally misses the point. If the aid from Trenton was credited directly to individual tax payers property tax obligation based on personal income then it might be fair. Of course, that would mean the property tax would then be a quasi income tax and/or ability to pay based tax. But this is not what exists. Just because one lives on the wrong side of the street, they are imputed with greater ability to pay than the guy they see out their front window. Ridiculous.
The above is why the context of the discussion about property taxes is so off-center. Fairness is the issue. No matter where one lives, they should be expected to contribute based on their own ability to pay, not an imputed ability simple because they have a rich neighbor.
I hope you can convince your editors that this is an important topic to be raised during this time of heightened attention to property taxes. Currently, it is being ignored as irrelevant or unimportant when it comes to the multitude of proposed solutions to the problem of high property taxes. It is forgotten that the burden of the Property Tax is individually borne and not supplemented for by one's rich neighbor. [Which raises the concomitant issue of the short shrift the disproportionate share lower income and fixed income taxpayers bear based on total income].
________________________________________
Read your article in today's Press about lawmakers wanting to cap spending in so-called rich districts.
Let me suggest that you and Gannett expose this misleading idea that there are "rich" and "poor" districts. The characterization would be true if there were only rich or only poor people living in those districts. The reality is there are an entire range of incomes represented in each. Individuals pay taxes by themselves. Their rich neighbor has nothing to do with that ability.
I live in Middletown where we receive state aid toward education in the upper teens as a percent of the total budget. Middletown has one of the better per pupil costs. Nothing near the Abbotts or other high-spending districts. We receive so little aid because we have a lot of wealthy residents. But I have yet to receive anything from them to help me pay my property taxes.
As you know, Middletown borders Keansburg, an Abbott district. I am not sure how much they receive from Trenton as a percent of their total education budget, but it certainly must exceed 60%. They are a "poor" district.
My suggestion for your reporting is that you could choose a street or block that acts as a border between the two towns. They will have similar sized and valued homes. The people who live in them will likely be in similar income brackets. BUT because one lives in Middletown and the other in Keansburg, they are each imputed with a different ability to shoulder the cost of local education spending. Obviously, they do not have differing abilities. But the state designates each district's ability to afford based on an average of the aggregate income, regardless of the range of incomes. Just because Keansburg does not have a Navesink River Road or a Locust (among other) areas, it has a lower average income, a lower "wealth" factor.
You can see how this is unfair and totally misses the point. If the aid from Trenton was credited directly to individual tax payers property tax obligation based on personal income then it might be fair. Of course, that would mean the property tax would then be a quasi income tax and/or ability to pay based tax. But this is not what exists. Just because one lives on the wrong side of the street, they are imputed with greater ability to pay than the guy they see out their front window. Ridiculous.
The above is why the context of the discussion about property taxes is so off-center. Fairness is the issue. No matter where one lives, they should be expected to contribute based on their own ability to pay, not an imputed ability simple because they have a rich neighbor.
I hope you can convince your editors that this is an important topic to be raised during this time of heightened attention to property taxes. Currently, it is being ignored as irrelevant or unimportant when it comes to the multitude of proposed solutions to the problem of high property taxes. It is forgotten that the burden of the Property Tax is individually borne and not supplemented for by one's rich neighbor. [Which raises the concomitant issue of the short shrift the disproportionate share lower income and fixed income taxpayers bear based on total income].
Monday, August 07, 2006
Corzine - Insincere or Insensitive and Oblivious
It should be obvious by now to anyone who heard Governor Corzine’s outline of his plan to fix the Property Tax crisis in New Jersey that there is no real hope for those most oppressed by this vicious tax. His speech was long on rhetoric and short on substantive reform.
His lack of sincerity—or political will—is confirmed by how he has no objection to the stacked committees with a four to two Democrat advantage, promising an outcome as productive as were the 2006 budget negotiations. Worse is key committee members who have a stake in the status quo. Does anyone really believe taxpayer interests will be served rather than vested interests?
The governor’s statement that most betrays his ostensible sincerity is that he’d like to limit future growth of the Property Tax to 4%. First off, that would be an increase over the current limit placed on the lion’s share of the property tax bill, education spending. Worse is the fact that it is a tacit admission that there will be no permanent reductions in the Property Tax, just a slower rate of growth. Thanks, Governor.
Nevertheless, regardless of whether the governor and the special committees are serious, they along with all politicians fail to demonstrate they understand the true nature of the problem with the Property Tax. It is simple. It is inherently unfair. It is skewed towards forcing those at the bottom to carry an unequal—higher—share of the total tax burden. Basic math confirms that built-in result will continue even if the tax is lowered. Are we interested in a just system of taxation or not?
We may need to find interim ways of giving relief to those presently being driven out of home and state due to the Property Tax. But the only real and lasting solution is to eliminate it completely. Anything short of that will only be a bandaid.
To answer those critics who point out we cannot—read as, lack the will to—reallocate a tax burden as large as that, there are two replies. First, it could be phased out over a five or ten year period, mitigating the impact of a single, massive shift of the tax burden.
Second, to say we cannot do it is to actually say we will not do it. And to say that is to imply that we do not care about those most adversely affected by the Property Tax. That means we are not interested in a fair system of taxation, and that we have little or no concern for those at the bottom when it requires boldness and sacrifice by those at the top. A sad commentary on the principles our state lives by: Love thy neighbor as long as long as I am not put out.
Until politicians, public interest groups and the taxpayer are willing to acknowledge the Property Tax is a tax which must be eliminated, low, no, and middle income taxpayers are doomed to more of what they suffer under today. It is that simple.
His lack of sincerity—or political will—is confirmed by how he has no objection to the stacked committees with a four to two Democrat advantage, promising an outcome as productive as were the 2006 budget negotiations. Worse is key committee members who have a stake in the status quo. Does anyone really believe taxpayer interests will be served rather than vested interests?
The governor’s statement that most betrays his ostensible sincerity is that he’d like to limit future growth of the Property Tax to 4%. First off, that would be an increase over the current limit placed on the lion’s share of the property tax bill, education spending. Worse is the fact that it is a tacit admission that there will be no permanent reductions in the Property Tax, just a slower rate of growth. Thanks, Governor.
Nevertheless, regardless of whether the governor and the special committees are serious, they along with all politicians fail to demonstrate they understand the true nature of the problem with the Property Tax. It is simple. It is inherently unfair. It is skewed towards forcing those at the bottom to carry an unequal—higher—share of the total tax burden. Basic math confirms that built-in result will continue even if the tax is lowered. Are we interested in a just system of taxation or not?
We may need to find interim ways of giving relief to those presently being driven out of home and state due to the Property Tax. But the only real and lasting solution is to eliminate it completely. Anything short of that will only be a bandaid.
To answer those critics who point out we cannot—read as, lack the will to—reallocate a tax burden as large as that, there are two replies. First, it could be phased out over a five or ten year period, mitigating the impact of a single, massive shift of the tax burden.
Second, to say we cannot do it is to actually say we will not do it. And to say that is to imply that we do not care about those most adversely affected by the Property Tax. That means we are not interested in a fair system of taxation, and that we have little or no concern for those at the bottom when it requires boldness and sacrifice by those at the top. A sad commentary on the principles our state lives by: Love thy neighbor as long as long as I am not put out.
Until politicians, public interest groups and the taxpayer are willing to acknowledge the Property Tax is a tax which must be eliminated, low, no, and middle income taxpayers are doomed to more of what they suffer under today. It is that simple.
Tuesday, July 25, 2006
When will they get it?
Beginning on July 28, there will be a special session of the NJ Legislature—which, it turns out, will only be a special session of special committees—to deal with the Property Tax. Well, not really. There are no plans to look at and propose solutions to the Property Tax as a tax in and of itself. They only intend to see how they can make it a more bearable tax, aka “reducing reliance upon”.
As this could be a turning point in NJ’s goal to stop driving people to the poor house and/or out the state due this oppressive tax, many are chiming in with their opinions. We have seen op-eds from the NJ League of Municipalities, the NJ Chamber of Commerce, current and former state leaders, taxpayer watchdog groups, columnists, newspaper editorials. The one thing they all have in common is they conflate two totally different issues. They see spending as the problem with property taxes. If spending were reduced then the Property Tax would remain acceptable as a tax source. Consequently, they automatically include the Property Tax as a fundamental part of the solution to addressing the issue.
It is time that our leaders and those who would devise a solution to come to the realization that high and out of control spending at all levels of government is not what makes the Property Tax a problem. The problem is the Property Tax is inherently unfair. Reducing how much people pay will not and can not address this fact.
The unfairness of the Property Tax is confirmed by the oft cited statistic that households earning the lowest 20% pay 9.2% of their income in property taxes, as compared with the top 20% who pay 3.6%; that is, the least able to afford it pay 2.6 times more. But that is just an average. The lower you go on the income scale the greater the share paid, as in the case of the widowed taxpayer who pays over seven times the percent share those at the top are paying. With $21,000 in income and $5,500 in taxes, she pays out over 25% of her income, not the average 9.2%. We need to be careful of statistics lulling us into thinking the situation is not as bad as it is.
So the statistics prove the Property Tax forces the subsidization of those least in need of tax relief by those least able to afford it. Neither will an across the board reduction of this tax change this disproportionate distribution of the tax burden. Simple mathematics prove fairness can never be achieved through lowering these taxes, the inequity is built in. Neither do measly rebates alleviate the situation. Short of a rebate of 50%, 75% or even 100% for those at the bottom, they will continue paying more than their fair share.
This is not to say that spending is not a problem. The variety of measures being offered as a way of reigning in spending are good ideas. They all ought to be implemented, but not because property taxes are too high. No, they need to be done because that is what good government is all about.
The only relationship the Property Tax has to the spending problem is that it has brought about an acute awareness of the need to address spending. That is because its inherent unfairness has progressively insinuated itself and become a major problem for more and more of those in the middle class. Politicians can no longer bank on ignoring those at the bottom because they are no longer the only ones being decimated by the Property Tax.
Nevertheless, the main point is that the Property Tax is inherently unfair. It must be eliminated in order to address that unfairness because there is no other way to do so. If the Property Tax is included in any solutions arrived at to lessen its present onerous impact, the cure will be short lived and quickly evanescing. It will only be a matter of five or ten years before, once again, it will be as onerous as ever and at the top of the issues in most need of addressing. Instead of wasting our time going down that road, let’s get it right today by eliminating it altogether.
As this could be a turning point in NJ’s goal to stop driving people to the poor house and/or out the state due this oppressive tax, many are chiming in with their opinions. We have seen op-eds from the NJ League of Municipalities, the NJ Chamber of Commerce, current and former state leaders, taxpayer watchdog groups, columnists, newspaper editorials. The one thing they all have in common is they conflate two totally different issues. They see spending as the problem with property taxes. If spending were reduced then the Property Tax would remain acceptable as a tax source. Consequently, they automatically include the Property Tax as a fundamental part of the solution to addressing the issue.
It is time that our leaders and those who would devise a solution to come to the realization that high and out of control spending at all levels of government is not what makes the Property Tax a problem. The problem is the Property Tax is inherently unfair. Reducing how much people pay will not and can not address this fact.
The unfairness of the Property Tax is confirmed by the oft cited statistic that households earning the lowest 20% pay 9.2% of their income in property taxes, as compared with the top 20% who pay 3.6%; that is, the least able to afford it pay 2.6 times more. But that is just an average. The lower you go on the income scale the greater the share paid, as in the case of the widowed taxpayer who pays over seven times the percent share those at the top are paying. With $21,000 in income and $5,500 in taxes, she pays out over 25% of her income, not the average 9.2%. We need to be careful of statistics lulling us into thinking the situation is not as bad as it is.
So the statistics prove the Property Tax forces the subsidization of those least in need of tax relief by those least able to afford it. Neither will an across the board reduction of this tax change this disproportionate distribution of the tax burden. Simple mathematics prove fairness can never be achieved through lowering these taxes, the inequity is built in. Neither do measly rebates alleviate the situation. Short of a rebate of 50%, 75% or even 100% for those at the bottom, they will continue paying more than their fair share.
This is not to say that spending is not a problem. The variety of measures being offered as a way of reigning in spending are good ideas. They all ought to be implemented, but not because property taxes are too high. No, they need to be done because that is what good government is all about.
The only relationship the Property Tax has to the spending problem is that it has brought about an acute awareness of the need to address spending. That is because its inherent unfairness has progressively insinuated itself and become a major problem for more and more of those in the middle class. Politicians can no longer bank on ignoring those at the bottom because they are no longer the only ones being decimated by the Property Tax.
Nevertheless, the main point is that the Property Tax is inherently unfair. It must be eliminated in order to address that unfairness because there is no other way to do so. If the Property Tax is included in any solutions arrived at to lessen its present onerous impact, the cure will be short lived and quickly evanescing. It will only be a matter of five or ten years before, once again, it will be as onerous as ever and at the top of the issues in most need of addressing. Instead of wasting our time going down that road, let’s get it right today by eliminating it altogether.
Monday, June 26, 2006
The American Nightmare: Do you really own your home?
I am not referring to broken water pipes and leaky roofs. I refer to what is commonly know as the American Dream. What is it? Owning one’s own home. Those without one pine over whether they will one day be able to achieve such. Those who begin the process often work two jobs or ungodly hours to afford a down payment and then embark on years of paying a mortgage. People strive, sweat and sacrifice over several decades just so they can own their home. Most everyone does this through borrowing. So, in the end, they often pay out fifty, one hundred, even two hundred percent more than the original price. It is a long, arduous and costly route hard working Americans travel, making the single largest purchase of their lives. Just to own their home. Just to live the American Dream.
Why do they bother? What is the reason people are willing to sacrifice so much? Is it materialism? Hardly. The investment value? A secondary reason, if at all. It is security in the present as well as in their old age. That is one major motive which causes people to take on such a daunting challenge.
Naive as it may sound, I wanted to own my home for the security it would give in my retirement years or through hard times. I figured I would always have a roof over my family's heads. Likewise, I foolishly thought that purchasing a home was like anything else one buys: after it is paid for it belongs to you. And as long as you maintain it, it will serve its purpose, and you own it to boot.
Foolish? Yes. For no one told me about the Property Tax. No one told me you don’t really own your home, you are renting it from your town. This is because property taxes are nothing more than rent. Fail to pay your taxes and you will be evicted. Evicted, regardless of whether you sweat and slaved all your life to own that home.
Worse, unlike any other tax which requires you to earn or spend something before you are obligated to pay it, property taxes are due merely because you “own” property. You might be unemployed. You might be disabled. You might be too old to work and on a very limited and virtually fixed income. The state does not care. Pay up, it says. Pay or else move out so we can sell your home to someone who can pay. This oppressive situation begins the minute you sign those papers to take “possession.” There is no other tax nor obligation we have that is like this.
Home ownership is a myth. It is not true. It is not real. We are all renters from the state. The only way to rectify this misconception is to eliminate the property tax. All the modification, tinkering, etc. to lessen its onerous nature will not change the facts. If we are subject to forfeiture of our homes for not paying a tax that has nothing to do with spending or earning an income then we do not own that property. But if there is no more property tax then we will have restored the right to private property. We will really own our home.
Only home owners (and renters who realize their rents include the “owner’s” property tax) can change this present injustice. It is up to them to write their senator and assemblymen that the jig is up and the property tax must be eliminated. Otherwise supposed benefits the American Dream of home ownership provides can only be believed through self-delusion, through believing a myth.
Why do they bother? What is the reason people are willing to sacrifice so much? Is it materialism? Hardly. The investment value? A secondary reason, if at all. It is security in the present as well as in their old age. That is one major motive which causes people to take on such a daunting challenge.
Naive as it may sound, I wanted to own my home for the security it would give in my retirement years or through hard times. I figured I would always have a roof over my family's heads. Likewise, I foolishly thought that purchasing a home was like anything else one buys: after it is paid for it belongs to you. And as long as you maintain it, it will serve its purpose, and you own it to boot.
Foolish? Yes. For no one told me about the Property Tax. No one told me you don’t really own your home, you are renting it from your town. This is because property taxes are nothing more than rent. Fail to pay your taxes and you will be evicted. Evicted, regardless of whether you sweat and slaved all your life to own that home.
Worse, unlike any other tax which requires you to earn or spend something before you are obligated to pay it, property taxes are due merely because you “own” property. You might be unemployed. You might be disabled. You might be too old to work and on a very limited and virtually fixed income. The state does not care. Pay up, it says. Pay or else move out so we can sell your home to someone who can pay. This oppressive situation begins the minute you sign those papers to take “possession.” There is no other tax nor obligation we have that is like this.
Home ownership is a myth. It is not true. It is not real. We are all renters from the state. The only way to rectify this misconception is to eliminate the property tax. All the modification, tinkering, etc. to lessen its onerous nature will not change the facts. If we are subject to forfeiture of our homes for not paying a tax that has nothing to do with spending or earning an income then we do not own that property. But if there is no more property tax then we will have restored the right to private property. We will really own our home.
Only home owners (and renters who realize their rents include the “owner’s” property tax) can change this present injustice. It is up to them to write their senator and assemblymen that the jig is up and the property tax must be eliminated. Otherwise supposed benefits the American Dream of home ownership provides can only be believed through self-delusion, through believing a myth.
Monday, June 12, 2006
Response to Assm Panter
Save Our Homes and Our Future
Here is a reply I just made to Assm Panter on his blog. He was expressing hope that the Property Tax issue will be addressed in a meaningful way.
*********************
I am sorry to report that there is little or no hope for genuine property tax reform until the actual problem is acknowledged and addressed. It is that the Property Tax is fundamentally unfair. As it does not take into account one's ability to pay, it automatically (without any special interest tax law snuck in to benefit the well connected) causes those at the bottom to pay a tax relative to income that is obsene.
Here is an example from a woman I have recently spoken to who called me in regard to my letters to the editor.
This is not made up. There is a 79 year old widow who lives in Middletown Twp. She has annual income of $21,000. Her Property Tax bill is $5500. That means she is paying over 25% of her meager income in property taxes.
The top Income Tax rate in NJ for those making $500,000 is only 9%. So one must ask, is this a fair system? Do you think you could live on what this widow has left after paying her taxes? Should she be forced to move from her home of 51 years simply because we have an unjust and oppressive tax system?
How many people making $500,000 also have a $125,000 property tax bill? And even if they did, they certainly might manage to scrape by on the remaining $375,000.
We need to change the system. Until politicians and tax reform groups stop focussing on spending as the problem, there will never be genuine property tax reform.
The writer who lives in Marlboro would probably like to have the peace of mind that comes with know that if they experienced a precipitous drop in their income, they would not be forced from their home because they could no longer afford their property taxes.
Do not mistake what I say. Yes, spending should be addressed. But that should happen regardless of how we collect taxes to fund government services.
One must also acknowledge the reality that there can never be enough "savings" found on the spending side to help people such as the widow mentioned above. Does anyone really believe that cutting her property taxes in half ever happen? And even if it did, can anyone say with a straight face that she should be paying any taxes?
Let's get to the real issue here. The Property Tax is an outdated, oppressive and unjust tax. We must pay for government services a different way than that.
Here is a reply I just made to Assm Panter on his blog. He was expressing hope that the Property Tax issue will be addressed in a meaningful way.
*********************
I am sorry to report that there is little or no hope for genuine property tax reform until the actual problem is acknowledged and addressed. It is that the Property Tax is fundamentally unfair. As it does not take into account one's ability to pay, it automatically (without any special interest tax law snuck in to benefit the well connected) causes those at the bottom to pay a tax relative to income that is obsene.
Here is an example from a woman I have recently spoken to who called me in regard to my letters to the editor.
This is not made up. There is a 79 year old widow who lives in Middletown Twp. She has annual income of $21,000. Her Property Tax bill is $5500. That means she is paying over 25% of her meager income in property taxes.
The top Income Tax rate in NJ for those making $500,000 is only 9%. So one must ask, is this a fair system? Do you think you could live on what this widow has left after paying her taxes? Should she be forced to move from her home of 51 years simply because we have an unjust and oppressive tax system?
How many people making $500,000 also have a $125,000 property tax bill? And even if they did, they certainly might manage to scrape by on the remaining $375,000.
We need to change the system. Until politicians and tax reform groups stop focussing on spending as the problem, there will never be genuine property tax reform.
The writer who lives in Marlboro would probably like to have the peace of mind that comes with know that if they experienced a precipitous drop in their income, they would not be forced from their home because they could no longer afford their property taxes.
Do not mistake what I say. Yes, spending should be addressed. But that should happen regardless of how we collect taxes to fund government services.
One must also acknowledge the reality that there can never be enough "savings" found on the spending side to help people such as the widow mentioned above. Does anyone really believe that cutting her property taxes in half ever happen? And even if it did, can anyone say with a straight face that she should be paying any taxes?
Let's get to the real issue here. The Property Tax is an outdated, oppressive and unjust tax. We must pay for government services a different way than that.
Coming Soon
Save Our Homes and Our Future
I am presently setting up a website. Unfortunately, when one works a full time job it is hard to find the time to take care of routine home affairs as well as devote full time type of hours to this.
I am presently setting up a website. Unfortunately, when one works a full time job it is hard to find the time to take care of routine home affairs as well as devote full time type of hours to this.
Tuesday, May 16, 2006
I respond to Assemblyman Thompson
Save Our Homes and Our Future
Assemblyman Thompson,
Thanks for your response. I will forward your response to my email. But I beg to differ that I have misrepresented you. As for a one-sided presentation, I only presented my case against those who reject the need to eliminate the property tax.
Yes, you may have agreed the property tax is unfair but then in our conversation and in your reply below you go on to defend its retention. For me it is a moral issue, not pragmatic. It is inherently unfair. If one believes this then how can they agree to continue it?
I disagree with your equating the property tax with Sales and Use taxes as a reason to reject my argument about the pernicious nature and the need to get rid of the property tax. Maybe they also should be eliminated. Being inconsistent does not make my argument about the inequity of the property tax wrong. And among the three taxes you mention, it has a unique application in how much is collected.
The main difference of the property from most other taxes is that it is collected no correlation to income. One can only pay so much Sales Tax based upon how much money they spend. New Jersey does not come knocking on people's door to collect more Sales Tax if one has not spent enough money. In fact, the Sales Tax recognizes there are basic necessities people need to live. It is considered unfair and wrong to tax them on things such as food, clothing, and medicine. This same idea is reflected in the Income Tax when it exempts the first $25,000 in income from taxation. There are some necessities subject to the Sales Tax. But there are many things one need not buy and thus not pay Sales Tax. So, one has control over how much Sales Tax they pay; not so with the property tax.
You reject elimination of the property tax because increases in other taxes would be "so massive, middle income people would be driven out of the State". I reject this as another red herring. In fact, research shows huge numbers of people are already exiting N.J. due to being unable to bear any longer the oppresive property tax. Furthermore, people are not just going to pull up stakes to leave; they would have to have jobs to go to. The overall national economy might be good, but leaving the metropolitan area would mean moving to lower wage jobs IF one can find one. But as to the need for a "massive" tax increase in other areas? There is no reason phasing in a change that eventuates in no Property Tax cannot be done. This was essentially Bret Shundler's plan.
There are advantages to be had from elimination. What about the increased affordability of homes to young people when the property tax no longer affects getting a home loan? The peace of mind and security that these same folk will have now knowing they will not lose their homes to a tax auction or be forced to move or retire out of state will have benefits far beyond what we can imagine. Some people would likely move here knowing they will have the security of a roof over their heads til the end of their life.
You also ignore the economic benefits to the state of increasing spendable income of middle and lower income. It is not as if they are going to stick the extra money in a mattress. More likely is they will buy the new car, appliances, make the home repairs or improvements, purchase health insurance, etc. These are things which they could not afford before. Spending such as this at this local level can only serve to boost the economy.
Another objection you have is "For your position to be correct, local spending (schools and government) would have to never increase or some other tax would have to be raised. You should also note if local authorities do not have to impose or collect any taxes but instead merely decide how much they want to spend, there would be zero incentive for them to hold down their spending". This is not necessarily true. Neither did I say local authorities would or should be left unchecked. Maybe you want to give local authorities the right to impose local income taxes as some cities (New York, e.g.) do. Then they would have to justify constantly raising their income tax or get spending under control so they do not have to. I have never argued against reigning in spending. I am just saying we must not confuse it with the moral fairness of the property tax.
You make the point "You ask where is the justice when your neighbor pays the same property tax as you while making 4-5 times your income? I will not attempt to justify this situation but you also must recognize that while he is paying the same property tax as you, he is probably already paying more than 4-5 times as much income tax as you since he is in a higher income bracket." Yes, but that makes my point about our tax system being progressive and based upon the ability to pay. And he is not paying more than about 9% state income tax even if he is making over $500,000. I am paying ten percent and there are many people paying much greater percentages. And they are not left with $455,000 after paying their tax."
And, of course, the following is a non-sequitur: "If he bought his identical house a year or two ago and you purchased yours 30 years ago, he might also argue that it is unfair you only paid $60,000 for your house and he had to pay $360,000. He might also argue it is consequently unfair that he now has these very large mortgage payments and you have little or none." The state has nothing to do with this, neither does the mortgage payment one makes have bearing on the equity of the property tax. As I pointed out above, if anything, eliminating the property tax will enable many young and lower income people to now afford to purchase a home.
You point out that "There will be winners and losers in any proposal put forward to either reduce or eliminate property taxes". True. Just as during revaluations the typical outcome is 1/3 of the home owners taxes go up, 1/3 go down, and 1/3 stay the same. The difference is that in the latter case there is no built in equity. Someone who bought in an undesirable location 30 years ago because it was in a more affordable area might now be socked with extraoridinarily high taxes just because it is now a desireable section of town. If all government services are funded by an income tax then fairness to all remains the order of the day. This is never the case with the property tax. Never.
Again you state, "I will restate my agreement that property taxes are not equitable and fair. But this statement applies equally to sales tax and any other tax or fee that is not income based be it motor vehicle fees, gasoline tax, marriage license, court fees, etc., etc". And again I point out that none of these taxes come close to consuming 10%, 20%, 30%, 40% or more of anyone's total income.
I am sorry if you are offended if I refer to you as a defeatist. It is not because you won't do things my way. It is because it is the same response I receive from people in your position on influence all the time. It is summed up with, "Yes, the property tax is unfair. But we cannot eliminate it." To me that is giving up on the idea before it is even considered. Now there are some like Jon Sure of N.J. Policy Perspectives who find it a useful tax. They fail to see it as unfair, unjust, inequitible and immoral. They are not defeatists. They are wrong in not seeing it for what it is, but they are not opposed to eliminating it just because they have decided it cannot be done even though they believe it to be wrong. There is a big difference. And I am tired of hearing people agree it is wrong but then decide to not even try to eliminate just because it cannot be done. Well, if everyone would decide to do it, it could be done. Those who decide not to have accepted defeat without even trying. Don't be insulted, just consider.
Assemblyman Thompson, I thank you for taking the time to engage on this issue. If the points I raise are never discussed they have no possiblity of effecting change. Just remember, we should do unto the least of us as we would have them do unto us. At this time, New Jersey's leaders are not committed to this principle.
Assemblyman Thompson,
Thanks for your response. I will forward your response to my email. But I beg to differ that I have misrepresented you. As for a one-sided presentation, I only presented my case against those who reject the need to eliminate the property tax.
Yes, you may have agreed the property tax is unfair but then in our conversation and in your reply below you go on to defend its retention. For me it is a moral issue, not pragmatic. It is inherently unfair. If one believes this then how can they agree to continue it?
I disagree with your equating the property tax with Sales and Use taxes as a reason to reject my argument about the pernicious nature and the need to get rid of the property tax. Maybe they also should be eliminated. Being inconsistent does not make my argument about the inequity of the property tax wrong. And among the three taxes you mention, it has a unique application in how much is collected.
The main difference of the property from most other taxes is that it is collected no correlation to income. One can only pay so much Sales Tax based upon how much money they spend. New Jersey does not come knocking on people's door to collect more Sales Tax if one has not spent enough money. In fact, the Sales Tax recognizes there are basic necessities people need to live. It is considered unfair and wrong to tax them on things such as food, clothing, and medicine. This same idea is reflected in the Income Tax when it exempts the first $25,000 in income from taxation. There are some necessities subject to the Sales Tax. But there are many things one need not buy and thus not pay Sales Tax. So, one has control over how much Sales Tax they pay; not so with the property tax.
You reject elimination of the property tax because increases in other taxes would be "so massive, middle income people would be driven out of the State". I reject this as another red herring. In fact, research shows huge numbers of people are already exiting N.J. due to being unable to bear any longer the oppresive property tax. Furthermore, people are not just going to pull up stakes to leave; they would have to have jobs to go to. The overall national economy might be good, but leaving the metropolitan area would mean moving to lower wage jobs IF one can find one. But as to the need for a "massive" tax increase in other areas? There is no reason phasing in a change that eventuates in no Property Tax cannot be done. This was essentially Bret Shundler's plan.
There are advantages to be had from elimination. What about the increased affordability of homes to young people when the property tax no longer affects getting a home loan? The peace of mind and security that these same folk will have now knowing they will not lose their homes to a tax auction or be forced to move or retire out of state will have benefits far beyond what we can imagine. Some people would likely move here knowing they will have the security of a roof over their heads til the end of their life.
You also ignore the economic benefits to the state of increasing spendable income of middle and lower income. It is not as if they are going to stick the extra money in a mattress. More likely is they will buy the new car, appliances, make the home repairs or improvements, purchase health insurance, etc. These are things which they could not afford before. Spending such as this at this local level can only serve to boost the economy.
Another objection you have is "For your position to be correct, local spending (schools and government) would have to never increase or some other tax would have to be raised. You should also note if local authorities do not have to impose or collect any taxes but instead merely decide how much they want to spend, there would be zero incentive for them to hold down their spending". This is not necessarily true. Neither did I say local authorities would or should be left unchecked. Maybe you want to give local authorities the right to impose local income taxes as some cities (New York, e.g.) do. Then they would have to justify constantly raising their income tax or get spending under control so they do not have to. I have never argued against reigning in spending. I am just saying we must not confuse it with the moral fairness of the property tax.
You make the point "You ask where is the justice when your neighbor pays the same property tax as you while making 4-5 times your income? I will not attempt to justify this situation but you also must recognize that while he is paying the same property tax as you, he is probably already paying more than 4-5 times as much income tax as you since he is in a higher income bracket." Yes, but that makes my point about our tax system being progressive and based upon the ability to pay. And he is not paying more than about 9% state income tax even if he is making over $500,000. I am paying ten percent and there are many people paying much greater percentages. And they are not left with $455,000 after paying their tax."
And, of course, the following is a non-sequitur: "If he bought his identical house a year or two ago and you purchased yours 30 years ago, he might also argue that it is unfair you only paid $60,000 for your house and he had to pay $360,000. He might also argue it is consequently unfair that he now has these very large mortgage payments and you have little or none." The state has nothing to do with this, neither does the mortgage payment one makes have bearing on the equity of the property tax. As I pointed out above, if anything, eliminating the property tax will enable many young and lower income people to now afford to purchase a home.
You point out that "There will be winners and losers in any proposal put forward to either reduce or eliminate property taxes". True. Just as during revaluations the typical outcome is 1/3 of the home owners taxes go up, 1/3 go down, and 1/3 stay the same. The difference is that in the latter case there is no built in equity. Someone who bought in an undesirable location 30 years ago because it was in a more affordable area might now be socked with extraoridinarily high taxes just because it is now a desireable section of town. If all government services are funded by an income tax then fairness to all remains the order of the day. This is never the case with the property tax. Never.
Again you state, "I will restate my agreement that property taxes are not equitable and fair. But this statement applies equally to sales tax and any other tax or fee that is not income based be it motor vehicle fees, gasoline tax, marriage license, court fees, etc., etc". And again I point out that none of these taxes come close to consuming 10%, 20%, 30%, 40% or more of anyone's total income.
I am sorry if you are offended if I refer to you as a defeatist. It is not because you won't do things my way. It is because it is the same response I receive from people in your position on influence all the time. It is summed up with, "Yes, the property tax is unfair. But we cannot eliminate it." To me that is giving up on the idea before it is even considered. Now there are some like Jon Sure of N.J. Policy Perspectives who find it a useful tax. They fail to see it as unfair, unjust, inequitible and immoral. They are not defeatists. They are wrong in not seeing it for what it is, but they are not opposed to eliminating it just because they have decided it cannot be done even though they believe it to be wrong. There is a big difference. And I am tired of hearing people agree it is wrong but then decide to not even try to eliminate just because it cannot be done. Well, if everyone would decide to do it, it could be done. Those who decide not to have accepted defeat without even trying. Don't be insulted, just consider.
Assemblyman Thompson, I thank you for taking the time to engage on this issue. If the points I raise are never discussed they have no possiblity of effecting change. Just remember, we should do unto the least of us as we would have them do unto us. At this time, New Jersey's leaders are not committed to this principle.
Assemblyman Thompson responds
Save Our Homes and Our Future
To: John Hendirckson
From: Assemblyman Samuel D. Thompson, Ph.D.
I have reviewed the e-mail you sent out regarding our conversation this morning. I find that you have distorted or misstated a number of my positions and presented a very one-sided presentation of the discussion.
If you have any sense of fairness, I would request that you forward my response that follows to the recipients of your missive.
You state you had two main points, both of which you indicate I disagreed with. Your first point was, “conflating state and local spending problems which have driven up property taxes with dealing with the fairness aspect of how education, municipalities and counties are funded is the wrong approach”….because “property taxes are inherently unfair because they do not take into account ones’ ability to pay.” You add I was not able to justify that they are a fair and just tax.
You should recall in my opening comment to you I stated in response to the message you had left with my staff that I do not consider the property tax to be an equitable and fair tax.
I began drafting my response as a point by point refutation of various comments and assertions contained in your e-mail but instead have decided to give my summary of our discussion and leave it to you and the readers to draw their own conclusions.
I began our conversation by responding to a question you had left with my staff. I do not consider the property tax to be equitable and fair. I did not state but would add; neither are the State Sales and Use Tax which is the States’ second largest generator of revenue projected at $6.7 billion in FY06. I did disagree you can not separate state and local spending concerns from the fairness aspect of how local entitles are funded. Spending determines how much revenue must be obtained which has a direct bearing on revenue source options.
It is your opinion reducing property taxes (which I support) to reduce the inequity is not satisfactory – they must be totally eliminated because of their unfairness. It is interesting to note you do not call for the elimination of sales tax which has the same inequity. You argued this could be accomplished by an increase in the income tax which could be simultaneously modified so low income people (less than $25,000) would pay no income tax.
I responded that the increases required to totally eliminate property taxes would have to be so massive, middle income people would be driven out of the State. To buttress my argument, projected Gross Income Tax receipts for FY06 have been projected to be $10.6 billion. The latest figures I have available indicate total property tax collections statewide in FY05 were in excess of $19 billion. Consequently, totally eliminating property taxes through increasing income taxes would require tripling all current income tax rates even without considering eliminating income tax for lower income individuals.
As for your assertion that Trenton would never increase income taxes annually even if it was the only way to meet the demands for local spending, I wouldn’t recommend you place any wagers on that (we disagreed on this point). For your position to be correct, local spending (schools and government) would have to never increase or some other tax would have to be raised. You should also note if local authorities do not have to impose or collect any taxes but instead merely decide how much they want to spend, there would be zero incentive for them to hold down their spending.
If after reading the foregoing, you should say, well maybe we shouldn’t fund totally eliminating property taxes just from income taxes but instead spread it over several revenue sources. Total projected State revenue from its’ three major sources – Income Taxes ($10.6b); Sales and Use ($6.7B) and Corporate ($2.8B), totals $20.1B. Thus, it would require doubling the rate for all three taxes to supplant the property tax totally.
You ask where is the justice when your neighbor pays the same property tax as you while making 4-5 times your income? I will not attempt to justify this situation but you also must recognize that while he is paying the same property tax as you, he is probably already paying more than 4-5 times as much income tax as you since he is in a higher income bracket. If he bought his identical house a year or two ago and you purchased yours 30 years ago, he might also argue that it is unfair you only paid $60,000 for your house and he had to pay $360,000. He might also argue it is consequently unfair that he now has these very large mortgage payments and you have little or none.
You described discussing the fact that eliminating the property taxes would mean raising taxes in other areas as raising a red herring. This discussion may be a red herring to you but I can assure you it is not a red herring to the populace as a whole. There will be winners and losers in any proposal put forward to either reduce or eliminate property taxes. Ultimately the plan will have to be approved by the voters in a statewide referendum. It will pass or fail depending on whether or not a majority of voters believe they will be better off if the proposal is adopted. This decision will be determined by their assessment of both how much they will save on property taxes and how much additional they will pay in new tax increases. The two figures are inseparable.
I will restate my agreement that property taxes are not equitable and fair. But this statement applies equally to sales tax and any other tax or fee that is not income based be it motor vehicle fees, gasoline tax, marriage license, court fees, etc., etc.
I agree we must take action to significantly diminish the impact of property taxes and for the past several years have voted numerous times for a measure to move forward on this issue only to have the Democrat Majority table the motion.
Finally, in the closing portion of your correspondence, you speak of the need to get rid of legislators who “begin with a defeatist attitude”.
John, if you feel I do not represent your interests, I have not problem if you choose to work for my defeat. However, if you are labeling me as having a “defeatist attitude” because I disagree with you on the approach to an issue and therefore will not work towards that end, then I resent that very much.
Sincerely,
Samuel D. Thompson, Ph.D.
Assemblyman
13th Legislative District
To: John Hendirckson
From: Assemblyman Samuel D. Thompson, Ph.D.
I have reviewed the e-mail you sent out regarding our conversation this morning. I find that you have distorted or misstated a number of my positions and presented a very one-sided presentation of the discussion.
If you have any sense of fairness, I would request that you forward my response that follows to the recipients of your missive.
You state you had two main points, both of which you indicate I disagreed with. Your first point was, “conflating state and local spending problems which have driven up property taxes with dealing with the fairness aspect of how education, municipalities and counties are funded is the wrong approach”….because “property taxes are inherently unfair because they do not take into account ones’ ability to pay.” You add I was not able to justify that they are a fair and just tax.
You should recall in my opening comment to you I stated in response to the message you had left with my staff that I do not consider the property tax to be an equitable and fair tax.
I began drafting my response as a point by point refutation of various comments and assertions contained in your e-mail but instead have decided to give my summary of our discussion and leave it to you and the readers to draw their own conclusions.
I began our conversation by responding to a question you had left with my staff. I do not consider the property tax to be equitable and fair. I did not state but would add; neither are the State Sales and Use Tax which is the States’ second largest generator of revenue projected at $6.7 billion in FY06. I did disagree you can not separate state and local spending concerns from the fairness aspect of how local entitles are funded. Spending determines how much revenue must be obtained which has a direct bearing on revenue source options.
It is your opinion reducing property taxes (which I support) to reduce the inequity is not satisfactory – they must be totally eliminated because of their unfairness. It is interesting to note you do not call for the elimination of sales tax which has the same inequity. You argued this could be accomplished by an increase in the income tax which could be simultaneously modified so low income people (less than $25,000) would pay no income tax.
I responded that the increases required to totally eliminate property taxes would have to be so massive, middle income people would be driven out of the State. To buttress my argument, projected Gross Income Tax receipts for FY06 have been projected to be $10.6 billion. The latest figures I have available indicate total property tax collections statewide in FY05 were in excess of $19 billion. Consequently, totally eliminating property taxes through increasing income taxes would require tripling all current income tax rates even without considering eliminating income tax for lower income individuals.
As for your assertion that Trenton would never increase income taxes annually even if it was the only way to meet the demands for local spending, I wouldn’t recommend you place any wagers on that (we disagreed on this point). For your position to be correct, local spending (schools and government) would have to never increase or some other tax would have to be raised. You should also note if local authorities do not have to impose or collect any taxes but instead merely decide how much they want to spend, there would be zero incentive for them to hold down their spending.
If after reading the foregoing, you should say, well maybe we shouldn’t fund totally eliminating property taxes just from income taxes but instead spread it over several revenue sources. Total projected State revenue from its’ three major sources – Income Taxes ($10.6b); Sales and Use ($6.7B) and Corporate ($2.8B), totals $20.1B. Thus, it would require doubling the rate for all three taxes to supplant the property tax totally.
You ask where is the justice when your neighbor pays the same property tax as you while making 4-5 times your income? I will not attempt to justify this situation but you also must recognize that while he is paying the same property tax as you, he is probably already paying more than 4-5 times as much income tax as you since he is in a higher income bracket. If he bought his identical house a year or two ago and you purchased yours 30 years ago, he might also argue that it is unfair you only paid $60,000 for your house and he had to pay $360,000. He might also argue it is consequently unfair that he now has these very large mortgage payments and you have little or none.
You described discussing the fact that eliminating the property taxes would mean raising taxes in other areas as raising a red herring. This discussion may be a red herring to you but I can assure you it is not a red herring to the populace as a whole. There will be winners and losers in any proposal put forward to either reduce or eliminate property taxes. Ultimately the plan will have to be approved by the voters in a statewide referendum. It will pass or fail depending on whether or not a majority of voters believe they will be better off if the proposal is adopted. This decision will be determined by their assessment of both how much they will save on property taxes and how much additional they will pay in new tax increases. The two figures are inseparable.
I will restate my agreement that property taxes are not equitable and fair. But this statement applies equally to sales tax and any other tax or fee that is not income based be it motor vehicle fees, gasoline tax, marriage license, court fees, etc., etc.
I agree we must take action to significantly diminish the impact of property taxes and for the past several years have voted numerous times for a measure to move forward on this issue only to have the Democrat Majority table the motion.
Finally, in the closing portion of your correspondence, you speak of the need to get rid of legislators who “begin with a defeatist attitude”.
John, if you feel I do not represent your interests, I have not problem if you choose to work for my defeat. However, if you are labeling me as having a “defeatist attitude” because I disagree with you on the approach to an issue and therefore will not work towards that end, then I resent that very much.
Sincerely,
Samuel D. Thompson, Ph.D.
Assemblyman
13th Legislative District
Comments on a conversation with a state legislator
Save Our Homes and Our Future
I just got off the phone with a long time state assemblyman. He is a nice man. He appears to put a lot of time into working for his constituents. He is a generous man, supplementing the meager paycheck our legislators receive with his own money so he can work full time on state legislative matters. This also means he has given up much personal time as a sacrifice to serve this state. In fact, he is just about to leave on a trip to China to see what kind of trade connections he can help find for New Jersey which will benefit our state’s economy. I have voted for him every election his has run.
Even with all these good points about the man, I hung up the phone with great disappointment. That is because of all the legislators in Trenton he is one I thought would give a sympathetic ear to my points about how to address the property tax problem in N.J. Instead, my ideas were dismissed out of hand. I did not even a “you’ve got a point there” let alone a "I'll think about it."
I made two main points, both of which he disagreed with. The first was that conflating state and local spending problems which have driven up property taxes with dealing with the fairness aspect of how education, municipalities and counties are funded is the wrong approach. These are two different things. Property taxes are not unfair because they are too high. They are inherently unfair because they do not take into account one’s ability to pay. As with every other I have challenged, the assemblyman was not able to justify that they are a fair and just tax.
The second point I made was that the property tax needs to be eliminated. There are two reasons. First being it is fundamentally inequitable. I pointed out how no matter how low this pernicious tax might become, since it has nothing to do with one’s ability to pay, it can never be made fair and just as a tax.
Second, its elimination will force Trenton legislators and the governor to come to grips with runaway spending. That is because they will no longer be able to rely upon annual increases in the property tax to absorb spending increases in non-education areas. Trenton “increases” revenue for those other areas through flat funding of education, diversion of nearly 50% of education funds to Abbott districts, unfunded mandates, etc. This assemblyman disagreed that would be the case. He thinks he and his colleagues will continue to find ways to increase taxes. But if the property tax is replaced with a dedicated income tax, that could never happen. They would never be able to increase an income tax on an annual basis.
I asked where is the tax justice when my neighbor who pays about the same property tax as I while making four to five times my income. He could not answer. Talk about tax breaks for the well off.
Pointing out how a my projected Social Security and retirement income will be more than 50% consumed by property taxes evoked pity but not a change of his mind or even the promise to reconsider. You can see why I was depressed by our conversation.
When the assemblyman started to raise the red herring that eliminating the property tax would mean raising taxes in other areas, I agreed. But I also pointed out that the idea is to bring fairness and equity to how we tax our citizens. If we fund government services fairly, based upon ability to pay, of course some people’s taxes will be going up. But those who need it most will also see theirs go down if not even eliminated (even the state income tax does not begin until above $25,000 for a joint filing).
New Jersey needs new blood at all levels of government. We need men and women who are not afraid to challenge the status quo. We need people of courage and conviction, not men and women who begin with a defeatist attitude. We need those who will not reject the suggestion of eliminating the property tax just because “it cannot be done.” Why not? It is only the idea that it cannot be done that prevents it from being done. Change your mind and it will be done. Where is the compassion and justice this nation was founded upon? Commitment to principles and ideals fortified the founding fathers of this nation. Today’s politicians have eviscerated those foundations; their commitment is to pragmatism and self-preservation.
If taxpayers, groups crying out for property tax reform, and syndicated columnists continue to think like the politicians, presupposing impossiblity by stopping short of demanding an end to the property tax, we will never see an end to the tragedy of people being driven out of their homes of a lifetime, leaving friends, children and grandchildren behind as they are forced to leave this state.
How very depressing.
I just got off the phone with a long time state assemblyman. He is a nice man. He appears to put a lot of time into working for his constituents. He is a generous man, supplementing the meager paycheck our legislators receive with his own money so he can work full time on state legislative matters. This also means he has given up much personal time as a sacrifice to serve this state. In fact, he is just about to leave on a trip to China to see what kind of trade connections he can help find for New Jersey which will benefit our state’s economy. I have voted for him every election his has run.
Even with all these good points about the man, I hung up the phone with great disappointment. That is because of all the legislators in Trenton he is one I thought would give a sympathetic ear to my points about how to address the property tax problem in N.J. Instead, my ideas were dismissed out of hand. I did not even a “you’ve got a point there” let alone a "I'll think about it."
I made two main points, both of which he disagreed with. The first was that conflating state and local spending problems which have driven up property taxes with dealing with the fairness aspect of how education, municipalities and counties are funded is the wrong approach. These are two different things. Property taxes are not unfair because they are too high. They are inherently unfair because they do not take into account one’s ability to pay. As with every other I have challenged, the assemblyman was not able to justify that they are a fair and just tax.
The second point I made was that the property tax needs to be eliminated. There are two reasons. First being it is fundamentally inequitable. I pointed out how no matter how low this pernicious tax might become, since it has nothing to do with one’s ability to pay, it can never be made fair and just as a tax.
Second, its elimination will force Trenton legislators and the governor to come to grips with runaway spending. That is because they will no longer be able to rely upon annual increases in the property tax to absorb spending increases in non-education areas. Trenton “increases” revenue for those other areas through flat funding of education, diversion of nearly 50% of education funds to Abbott districts, unfunded mandates, etc. This assemblyman disagreed that would be the case. He thinks he and his colleagues will continue to find ways to increase taxes. But if the property tax is replaced with a dedicated income tax, that could never happen. They would never be able to increase an income tax on an annual basis.
I asked where is the tax justice when my neighbor who pays about the same property tax as I while making four to five times my income. He could not answer. Talk about tax breaks for the well off.
Pointing out how a my projected Social Security and retirement income will be more than 50% consumed by property taxes evoked pity but not a change of his mind or even the promise to reconsider. You can see why I was depressed by our conversation.
When the assemblyman started to raise the red herring that eliminating the property tax would mean raising taxes in other areas, I agreed. But I also pointed out that the idea is to bring fairness and equity to how we tax our citizens. If we fund government services fairly, based upon ability to pay, of course some people’s taxes will be going up. But those who need it most will also see theirs go down if not even eliminated (even the state income tax does not begin until above $25,000 for a joint filing).
New Jersey needs new blood at all levels of government. We need men and women who are not afraid to challenge the status quo. We need people of courage and conviction, not men and women who begin with a defeatist attitude. We need those who will not reject the suggestion of eliminating the property tax just because “it cannot be done.” Why not? It is only the idea that it cannot be done that prevents it from being done. Change your mind and it will be done. Where is the compassion and justice this nation was founded upon? Commitment to principles and ideals fortified the founding fathers of this nation. Today’s politicians have eviscerated those foundations; their commitment is to pragmatism and self-preservation.
If taxpayers, groups crying out for property tax reform, and syndicated columnists continue to think like the politicians, presupposing impossiblity by stopping short of demanding an end to the property tax, we will never see an end to the tragedy of people being driven out of their homes of a lifetime, leaving friends, children and grandchildren behind as they are forced to leave this state.
How very depressing.
Monday, May 08, 2006
2-tiered solution brings tears to our eyes.
Save Our Homes and Our Future
A recent report by the Newark Star Ledger once again reveals the inability of those proposing solutions to the property tax problem to think outside the box. See: http://www.nj.com/news/ledger/jersey/index.ssf?/base/news-3/1146721898263090.xml&coll=1 The box they are in is the Property Tax. As far as they are concerned this box is the entire universe of tax possibilities, outside of which there is nothing. Put another way, the property tax is set in stone.
What is most discouraging is that the proposed solution to this anachronism of a tax was originally proposed in 1879. Yes, that is EIGHTTEEN seventy-nine, not 1979. So these people not only cannot think outside the box but they can only think in the past. What was is and will always be.
One of the reasons the property tax is so oppressive is that it has no relevance in this day and age. It is from a time when there was a direct correlation between how much property one owned and their ability to earn income. We were 90% agrarian at that time. If I owned 1,000 acres and you owned 10,000, you were taxed more because of your ability to earn more. More importantly, what you owned was directly tied to earning an income and your ability to pay taxes.
Today, the home we own has nothing to do with our ability to pay taxes. You can live in an area or on a street with homes of similar value. Yet the people living in them might have incomes (retirement, unemployment, disability, nothing at all, or only savings) ranging from $10,000 to hundreds of thousands of dollars. Yet they are taxed at virtually the same amount. Their ability to pay is not remotely related to the value of the home they own.
What is ever more astounding is that even though NJ recognizes that a couple ought not to be taxed on the first $25,000 of income these people think the property tax ought to be assessed and collected from the same people. Think about it. That same couple who are rightly not charged a single penny of tax on their $25,000 of income could be saddled with paying $3,000 (12%), $4,000 (16%) $6,000 (24%) or even more of that $25,000 in property taxes because no account is taken of their ability to pay.
I think the problem with these people who, tragically, are in positions of power and influence when it comes to solving this problem are out of touch. That is, they make plenty of money and so do not have to worry about losing their homes to a tax auction or having to leave family and friends of a lifetime because they cannot afford to live or retire in New Jersey. They just do not relate to the average person.
I am trying to be charitable in making the above charge. The only other reason is disparaging in its implications. It would be that they know they are getting a tax break at the expense of the little guy and they do not care. In fact, they know that they will have to pay their fair share if the property tax is eliminated. Since they have the power, they will not allow that to happen.
This 2-tiered solution proposed by the Regional Plan Association and supported by many state lawmakers is a cynical attempt to further entrench the property. It is a non-solution which if implemented will only continue the oppression of the little guys, driving they out of their homes and N.J. It must not be allowed on the table.
Is anybody listening?
A recent report by the Newark Star Ledger once again reveals the inability of those proposing solutions to the property tax problem to think outside the box. See: http://www.nj.com/news/ledger/jersey/index.ssf?/base/news-3/1146721898263090.xml&coll=1 The box they are in is the Property Tax. As far as they are concerned this box is the entire universe of tax possibilities, outside of which there is nothing. Put another way, the property tax is set in stone.
What is most discouraging is that the proposed solution to this anachronism of a tax was originally proposed in 1879. Yes, that is EIGHTTEEN seventy-nine, not 1979. So these people not only cannot think outside the box but they can only think in the past. What was is and will always be.
One of the reasons the property tax is so oppressive is that it has no relevance in this day and age. It is from a time when there was a direct correlation between how much property one owned and their ability to earn income. We were 90% agrarian at that time. If I owned 1,000 acres and you owned 10,000, you were taxed more because of your ability to earn more. More importantly, what you owned was directly tied to earning an income and your ability to pay taxes.
Today, the home we own has nothing to do with our ability to pay taxes. You can live in an area or on a street with homes of similar value. Yet the people living in them might have incomes (retirement, unemployment, disability, nothing at all, or only savings) ranging from $10,000 to hundreds of thousands of dollars. Yet they are taxed at virtually the same amount. Their ability to pay is not remotely related to the value of the home they own.
What is ever more astounding is that even though NJ recognizes that a couple ought not to be taxed on the first $25,000 of income these people think the property tax ought to be assessed and collected from the same people. Think about it. That same couple who are rightly not charged a single penny of tax on their $25,000 of income could be saddled with paying $3,000 (12%), $4,000 (16%) $6,000 (24%) or even more of that $25,000 in property taxes because no account is taken of their ability to pay.
I think the problem with these people who, tragically, are in positions of power and influence when it comes to solving this problem are out of touch. That is, they make plenty of money and so do not have to worry about losing their homes to a tax auction or having to leave family and friends of a lifetime because they cannot afford to live or retire in New Jersey. They just do not relate to the average person.
I am trying to be charitable in making the above charge. The only other reason is disparaging in its implications. It would be that they know they are getting a tax break at the expense of the little guy and they do not care. In fact, they know that they will have to pay their fair share if the property tax is eliminated. Since they have the power, they will not allow that to happen.
This 2-tiered solution proposed by the Regional Plan Association and supported by many state lawmakers is a cynical attempt to further entrench the property. It is a non-solution which if implemented will only continue the oppression of the little guys, driving they out of their homes and N.J. It must not be allowed on the table.
Is anybody listening?
Monday, May 01, 2006
Pollsters construct poll with wrong assumptions
Save Our Homes and Our Future
The latest Monmouth University/Gannett NJ poll help perpetuate the myth about the property tax. The myth is that it is assumed to permanent. Why?
Should the question not have been asked whether anyone wants to retain it at all?
Instead, the questions assume this egregious and unjust tax is here to stay. So it is no wonder when I speak to people who agree it is an oppressive and inequitable tax, they think the only hope is to reduce its level of taxation. It never occurs to them that it must or even can be eliminated.
When asked if it should be, they mostly agree. When asked if it can be eliminated, they assume it cannot be.
Why not? It is only not possible when people determine ahead of time that it cannot be done. They have this idea in their head and act accordingly. Is it rationally based? Of course not. The property tax is not an unchangeable law of the Universe, forever fixed in time and space. But people are making decisions as if it were.
So, it is merely an idea that prevents getting rid of the property tax. And when large, influential organizations fail to even float the idea, it never gets traction. This is a shame. Get the idea in your head that the property tax can be eliminated and it can happen. As simply as changing your mind.
The latest Monmouth University/Gannett NJ poll help perpetuate the myth about the property tax. The myth is that it is assumed to permanent. Why?
Should the question not have been asked whether anyone wants to retain it at all?
Instead, the questions assume this egregious and unjust tax is here to stay. So it is no wonder when I speak to people who agree it is an oppressive and inequitable tax, they think the only hope is to reduce its level of taxation. It never occurs to them that it must or even can be eliminated.
When asked if it should be, they mostly agree. When asked if it can be eliminated, they assume it cannot be.
Why not? It is only not possible when people determine ahead of time that it cannot be done. They have this idea in their head and act accordingly. Is it rationally based? Of course not. The property tax is not an unchangeable law of the Universe, forever fixed in time and space. But people are making decisions as if it were.
So, it is merely an idea that prevents getting rid of the property tax. And when large, influential organizations fail to even float the idea, it never gets traction. This is a shame. Get the idea in your head that the property tax can be eliminated and it can happen. As simply as changing your mind.
Tuesday, April 18, 2006
Eliminating Property Taxes: Improves health and reduces healthcare costs
Did you ever consider that health problems can be caused by the property tax? How so, you ask? Stress, that's how.
It is proven that when people are subject to sustained stress they get sick. So when one is constantly concerned about their financial situation due to the extreme drain property taxes puts on their budget, they get sick. That stress is compounded by the anxiety caused by the thought continuously hanging over their head that they are going to be forced to leave family, friends and the home of a lifetime. Why? Because of the inablility to pay both property taxes and basic living expenses. Owning a home is no longer an anchor of security, it is a major cause of health and financial ruin just because of the property tax.
This would be especially the case among retirees, but not limited to them. Folk presently out of a job, downsized, or out on disability leave experience huge drops in income. The result in all cases is people becoming greatly stressed over how they are going to pay their bills. Prolonged stress not only causes illness, but upheaval within families. Something else we can live without.
The fact that property taxes are not based on one's income nor ability to pay means they continue to be collected regardless of one's financial situation. And whereas people in the described circumstances need every penny they have, it is not hard to imagine the extreme stress that results from the Catch 22 they are in.
But if there were no property tax, this major cause of health and financial problems would be eliminated. It would free up money so many could now afford to purchase regular or supplemental health insurance. Less stress would mean less illness which, in turn, means less demand for healthcare services. Less demand on services would cause a corresponding decrease in healthcare costs. Lower premimius would benefit everyone, individuals and businesses. There are no losers here.
When are we going to realize the property tax is regressive in more ways than we can imagine? It is time to end it.
It is proven that when people are subject to sustained stress they get sick. So when one is constantly concerned about their financial situation due to the extreme drain property taxes puts on their budget, they get sick. That stress is compounded by the anxiety caused by the thought continuously hanging over their head that they are going to be forced to leave family, friends and the home of a lifetime. Why? Because of the inablility to pay both property taxes and basic living expenses. Owning a home is no longer an anchor of security, it is a major cause of health and financial ruin just because of the property tax.
This would be especially the case among retirees, but not limited to them. Folk presently out of a job, downsized, or out on disability leave experience huge drops in income. The result in all cases is people becoming greatly stressed over how they are going to pay their bills. Prolonged stress not only causes illness, but upheaval within families. Something else we can live without.
The fact that property taxes are not based on one's income nor ability to pay means they continue to be collected regardless of one's financial situation. And whereas people in the described circumstances need every penny they have, it is not hard to imagine the extreme stress that results from the Catch 22 they are in.
But if there were no property tax, this major cause of health and financial problems would be eliminated. It would free up money so many could now afford to purchase regular or supplemental health insurance. Less stress would mean less illness which, in turn, means less demand for healthcare services. Less demand on services would cause a corresponding decrease in healthcare costs. Lower premimius would benefit everyone, individuals and businesses. There are no losers here.
When are we going to realize the property tax is regressive in more ways than we can imagine? It is time to end it.
Monday, April 10, 2006
Did you ever consider the American Dream would become the American Nightmare?
What does it take to run your household? Household expenses include such things as: food, utilities, auto insurance, fuel and maintenance, home repairs and maintenance, healthcare expenses, health insurance, home owner’s insurance, clothing, and many other miscellaneous daily expenditures.
Do you think you could afford to pay for these things if after you have paid your Property Tax you had $8,000 left? How about $16,000? $25,000? Do you think you would need more than these amounts?
The tragic truth is that there are thousands of N.J. home owners who are in this very situation. They are on limited incomes or even no income (due to loss of job or medical disability). And the State and its legislators along with many special interest groups are either blind to these facts or willfully ignore them.
Try this: Take your income and then subtract each of the figures above one at a time, figuring how much your propety tax turns out to be For example, say your net takehome pay is $100,000. Subtract $25,000 for all living expenses. That would mean your property tax would be $75,000. Absurd to pay 75% of your income in property tax? Do you think you could use those taxes to pay your living expenses? What is the bite was 92% of your takehome pay and you were left with only $8,000? Do you think people should pay 75% of their income towards property taxes? Do you think people should be forced to try to live on such miniscule amounts after paying their property tax?
Again, the tragic truth is that this is the crushing reality with many home owners in NJ. These are folk who have limited retirement incomes or have been downsized or have temporary or permanent disability or just are unemployed. Yet they are taxed an inordinate and obscene percentage of their income. They are left unable to pay for essential living expenses. This is why the Property Tax is the single most regressive tax in existence.
That the property tax has become the leading taxpayer concern is an understatement. Lifetime residents are being driven out of their homes and even their state due to the property tax. People are being forced to risk losing their home because they buy food, pay utility and medical bills instead of paying their property taxes. A tax sale and being evicted is the result. If they could only learn to live on air, not get sick and get free utilities, they would need not worry. This is why taxpayers are demanding their elected officials deal with this growing nightmare.
The challenge to N.J. voters is to begin to think differently when it comes to addressing the property tax issue. We need to look at this issue afresh, questioning the presuppositions upon which the present public discussion is based.
When considering the property tax issue, many begin with the assumption the property tax is a given. That is, they assume that as a tax it is not to be questioned as to its validity or fairness. It is presumed that it is here to stay; it cannot or even should not be eliminated. This is the first and greatest mistake being made. Sadly, it is made by the vast majority of those in the position to influence how this issue is resolved. This mistaken assumption is also the starting point of many grassroots organizations. And it is even taken by those most oppressed by it: the ordinary taxpayer. Why? Is it an immutable principle of the Universe, ordained by God?
Ideas have power and consequences. There is power in ideas. The power manifests when people adopt an idea as their own and live accordingly.
When one begins with the idea that the property tax cannot be eliminated, that is an idea with power. The one-sided consequence to this starting point is the property tax becomes foundational to proposed solutions. We see that again and again in the solutions being proposed to this problem.
We can no longer afford to make this mistake. We must be clear in our assumptions before we try to come up with a solution. Begin with the idea that the property tax can be eliminated and that will open up a host of fixes which would not be considered otherwise.
Please survey the arguments made on this website. They state why the citizens of New Jersey must look at the presupposition that the property tax is as inviolable and as untouchable and as here to stay as the rising and setting of the sun. It need not be. One only needs to accept the idea it is dispensable and proceed from there. What stops you from believing the property tax is dispensable?
Do you think you could afford to pay for these things if after you have paid your Property Tax you had $8,000 left? How about $16,000? $25,000? Do you think you would need more than these amounts?
The tragic truth is that there are thousands of N.J. home owners who are in this very situation. They are on limited incomes or even no income (due to loss of job or medical disability). And the State and its legislators along with many special interest groups are either blind to these facts or willfully ignore them.
Try this: Take your income and then subtract each of the figures above one at a time, figuring how much your propety tax turns out to be For example, say your net takehome pay is $100,000. Subtract $25,000 for all living expenses. That would mean your property tax would be $75,000. Absurd to pay 75% of your income in property tax? Do you think you could use those taxes to pay your living expenses? What is the bite was 92% of your takehome pay and you were left with only $8,000? Do you think people should pay 75% of their income towards property taxes? Do you think people should be forced to try to live on such miniscule amounts after paying their property tax?
Again, the tragic truth is that this is the crushing reality with many home owners in NJ. These are folk who have limited retirement incomes or have been downsized or have temporary or permanent disability or just are unemployed. Yet they are taxed an inordinate and obscene percentage of their income. They are left unable to pay for essential living expenses. This is why the Property Tax is the single most regressive tax in existence.
That the property tax has become the leading taxpayer concern is an understatement. Lifetime residents are being driven out of their homes and even their state due to the property tax. People are being forced to risk losing their home because they buy food, pay utility and medical bills instead of paying their property taxes. A tax sale and being evicted is the result. If they could only learn to live on air, not get sick and get free utilities, they would need not worry. This is why taxpayers are demanding their elected officials deal with this growing nightmare.
The challenge to N.J. voters is to begin to think differently when it comes to addressing the property tax issue. We need to look at this issue afresh, questioning the presuppositions upon which the present public discussion is based.
When considering the property tax issue, many begin with the assumption the property tax is a given. That is, they assume that as a tax it is not to be questioned as to its validity or fairness. It is presumed that it is here to stay; it cannot or even should not be eliminated. This is the first and greatest mistake being made. Sadly, it is made by the vast majority of those in the position to influence how this issue is resolved. This mistaken assumption is also the starting point of many grassroots organizations. And it is even taken by those most oppressed by it: the ordinary taxpayer. Why? Is it an immutable principle of the Universe, ordained by God?
Ideas have power and consequences. There is power in ideas. The power manifests when people adopt an idea as their own and live accordingly.
When one begins with the idea that the property tax cannot be eliminated, that is an idea with power. The one-sided consequence to this starting point is the property tax becomes foundational to proposed solutions. We see that again and again in the solutions being proposed to this problem.
We can no longer afford to make this mistake. We must be clear in our assumptions before we try to come up with a solution. Begin with the idea that the property tax can be eliminated and that will open up a host of fixes which would not be considered otherwise.
Please survey the arguments made on this website. They state why the citizens of New Jersey must look at the presupposition that the property tax is as inviolable and as untouchable and as here to stay as the rising and setting of the sun. It need not be. One only needs to accept the idea it is dispensable and proceed from there. What stops you from believing the property tax is dispensable?
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