lb3 said:

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I'm with you on school funding. Cut the burdensome reporting requirements and let teachers teach. We don't need ivory palaces or fancy athletic facilities to learn. Temporary buildings that can be added and subtracted easily should be the norm rather than redistricting every few years.

I would get out of athletics all together and transition to year round schooling with a definitive tracks for professionals and those interested in the trades.

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Fancy athletic facilities and new schools are built with bond funds that are voted for by the citizens of the school district. While I agree that these are unnecessary, the citizens who would pay for them approved them.

A growing cost to schools is the definitive tracks you mentioned. Schools are building out CTE programs for all sorts of trades (HVAC, stylists, nursing, culinary arts, etc) along with college level courses (AP) that require extra teachers and resources.

The vast majority of these are demands of the community in which a school sits. So the school provides them as a response to the demands. That increases administration and costs.

Property taxes need to stay. Dump the ag exemption for BS non productive properties that are just leaching off of every one else.

Legit farm yes. BS "farm" no,

You must not have been on this board very long.

CrackerJackAg said:

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Property taxes need to stay. Dump the ag exemption for BS non productive properties that are just leaching off of every one else.

Legit farm yes. BS "farm" no,

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Along with that we need to remove exemptions from non-profits as well. Churches, Neighborhood centers, Temples & Mosques aren't immune to needing Fire and Police services.

AJ02 said:

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AggieIce said:

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AJ02 said:

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Obviously the difference would have to be made up elsewhere. Where would that be?

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Consumption tax would be the fairest

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Trying to imagine how that would be. Would it be across the board on EVERYTHING? Every clothing purchase, every purchase from Lowe's or Home Depot, etc? And how much? Would a $50 pair of jeans now cost $65?

Or is it reserved only for "large" purchases, like vehicles, homes, boats, etc?

I honestly have no real comprehension of just how much tax revenue in Florida is derived specifically from property taxes, and how much you'd have to increase the cost of other goods to offset that.

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I hope it is across the board for everything. Make it simple. Otherwise, you get people lobbying not to tax diapers because young couples can't afford it, or walking canes because the aged can't afford it, etc. Would wind up having to have a higher rate which would be born by the rest of us.

If you want state income tax, then this is how you get state income tax (ie, abolish property taxes).

We need state and local gov.. We don't need Harris County level incompetence.

We need to diversify the tax revenue options and fix loopholes. We also need to address needs, but remove ever growing government. At this point the state is growing so fast we are headed for a mess.

CrackerJackAg said:

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Property taxes need to stay. Dump the ag exemption for BS non productive properties that are just leaching off of every one else.

Legit farm yes. BS "farm" no,

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Great way to make land ownership impossible in Texas. Guess we should just give it all to the government to manage since normal people can't afford it anymore.

The biggest portion of my taxes go toward screwel taxes. Have you talked to your teacher today ?

HumbleAg04 said:

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CrackerJackAg said:

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Property taxes need to stay. Dump the ag exemption for BS non productive properties that are just leaching off of every one else.

Legit farm yes. BS "farm" no,

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Great way to make land ownership impossible in Texas. Guess we should just give it all to the government to manage since normal people can't afford it anymore.

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I think the opposite. Exemptions allow EXISTING & incompetent land owners that can't afford it to hold on to massive amounts of land that aren't productive.

An ag exemption on non productive properties is theft from everyone else paying into the system.

Sell what you can't afford or manage productively.

Gnome Sayin said:

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Do a sales tax. I don't want some arbitrary finger in the sky assumption of how much my home is worth so they can tax me off that.

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I've sort of the beat the drum on this. Your value is market value as of January 1. But how this is determined is ultimately based on mandates by your state legislature through the Comptroller's Property Value Study program. You can be mad at your appraisal district all you want, but they are following formulas, metrics, and requirements by the State of Texas.

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I want to see a large 40 foot neon sign over the capital that shows the tax rate. And if it needs to go up well then the politicians who's butts are in the seats will need to own it and not some mystery county guy.

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Federally we have a debt counter for the federal government - has that slowed down the increase since it was implemented in 1989?

AggieIce said:

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AJ02 said:

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Obviously the difference would have to be made up elsewhere. Where would that be?

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Consumption tax would be the fairest

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This is the fairest solution at that level, and also the national level. The rich spend more...so they will pay more... there, it's fair.

cslifer said:

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If you replace property tax with sales tax the residents take on more of a burden and businesses get a free pass. It would take an awful lot of sales taxes to make up for the lost property tax revenue from a mall or big box store.

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Businesses don't buy anything?

Doubtful Abbott will even follow suit here, as Texas and ISD's are so dependent on property tax


Even if Abbott shocks and Texas follows Floridas efforts, just another example of Abbott waiting for DeSantis before having the bravery to do something

Tex117 said:

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If you want state income tax, then this is how you get state income tax (ie, abolish property taxes).

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I would take an income tax over property tax any day of the week. Income goes down, income taxes go down. You can take action to reduce your income or accelerate your expenses. Property taxes go up and up, regardless of your income and ability to pay.

But I do not want both an income tax and a property tax even if they were to start out pretty low, neither will stay that way.

BMX Bandit said:

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People that rent do not pay property tax

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awful nice of those landlords to eat that cost and not bake it into the lease.

hopefully my tenants don't get wind of me being the only landlord not taking a loss on taxes

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You can only get in rent what the market will pay. If property tax goes up and rents don't, how then are landlords passing along the costs?

halfastros81 said:

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Maybe renters don't pay property tax directly but the landlords absolutely include the cost in the rent , so indirectly renters do pay property tax.

Maybe another way of saying it is the property tax comes out of what the landlord collects as rent but at the end of the day the landlord absolutely has to figure it into his business expenses and it needs to be covered by offsetting revenue or he'd be losing money.

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No the renter does not pay property taxes. If the place is empty for six months - is the next renter responsible for the 6 months they didn't live there? No the owner is

Renters do not pay property taxes

rgag12 said:

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If you got rid of property tax then you'd have to massively increase sales tax, and then also expand state government because you'd need apparatus in place to spread the tax out across the state. You'd have a situation where rural police, emergency services, and schools would have zero money and would have to be appropriated money from the urban parts of the state.

Property tax ain't going away.

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You could also eliminate appraisal districts, saving hundreds of millions of dollars. Property tax needs to go away. Plus, it's basically a wealth tax, which was outlawed in a recent constitutional amendment. Why are people okay with this particular tax?

Heineken-Ashi said:

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BMX Bandit said:

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People that rent do not pay property tax

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awful nice of those landlords to eat that cost and not bake it into the lease.

hopefully my tenants don't get wind of me being the only landlord not taking a loss on taxes

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You can only get in rent what the market will pay. If property tax goes up and rents don't, how then are landlords passing along the costs?

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Yes, the renters pay the property tax, just like consumers pay taxes passed on from corporations. They also pay the mortgage and maintenance, which is why people invest in rentals to begin with.

one safe place said:

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Tex117 said:

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If you want state income tax, then this is how you get state income tax (ie, abolish property taxes).

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I would take an income tax over property tax any day of the week. Income goes down, income taxes go down. You can take action to reduce your income or accelerate your expenses. Property taxes go up and up, regardless of your income and ability to pay.

But I do not want both an income tax and a property tax even if they were to start out pretty low, neither will stay that way.

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This is why governments don't want to eliminate property taxes. Property taxes are a consistent tax that increases every year without regard to income or consumption. It's easier to control us that way.

one safe place said:

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Tex117 said:

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If you want state income tax, then this is how you get state income tax (ie, abolish property taxes).

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I would take an income tax over property tax any day of the week. Income goes down, income taxes go down. You can take action to reduce your income or accelerate your expenses. Property taxes go up and up, regardless of your income and ability to pay.

But I do not want both an income tax and a property tax even if they were to start out pretty low, neither will stay that way.

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"But I do not want both an income tax and a property tax even if they were to start out pretty low, neither will stay that way."
Agree completely

SociallyConditionedAg said:

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Heineken-Ashi said:

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BMX Bandit said:

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Quote:

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People that rent do not pay property tax

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awful nice of those landlords to eat that cost and not bake it into the lease.

hopefully my tenants don't get wind of me being the only landlord not taking a loss on taxes

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You can only get in rent what the market will pay. If property tax goes up and rents don't, how then are landlords passing along the costs?

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Yes, the renters pay the property tax, just like consumers pay taxes passed on from corporations. They also pay the mortgage and maintenance, which is why people invest in rentals to begin with.

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That didn't answer my question. If rents cannot get any higher in the same period that property taxes rise, then how are the increased taxes passed the renter?

CrackerJackAg said:

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HumbleAg04 said:

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CrackerJackAg said:

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Property taxes need to stay. Dump the ag exemption for BS non productive properties that are just leaching off of every one else.

Legit farm yes. BS "farm" no,

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Great way to make land ownership impossible in Texas. Guess we should just give it all to the government to manage since normal people can't afford it anymore.

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I think the opposite. Exemptions allow EXISTING & incompetent land owners that can't afford it to hold on to massive amounts of land that aren't productive.

An ag exemption on non productive properties is theft from everyone else paying into the system.

Sell what you can't afford or manage productively.

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I despise the idea of large sections of undeveloped land suddenly needing to be chopped up and be developed because some people feel as if 100% of the land should be 100% utilized 100% of the time in a manner that they personally think should be utilized.

Also - there is a whole lot of land that simply cannot be effectively utilized for farming or ranching and is located in an area that does not have a population base to support selling it to walmart and having them build a store on it.

Property taxes are evil IMO. The only think you buy that you pay a sales tax on year in and year out - and don't even know what that tax will be until a bunch of appointed people decide what it is - is your property. But they will never go away in Texas because Texas is damn near full of Texans who think the way things have been done here is the only possibly way it could ever be done an any type of change is just impossible.

MookieBlaylock said:

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halfastros81 said:

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Maybe renters don't pay property tax directly but the landlords absolutely include the cost in the rent , so indirectly renters do pay property tax.

Maybe another way of saying it is the property tax comes out of what the landlord collects as rent but at the end of the day the landlord absolutely has to figure it into his business expenses and it needs to be covered by offsetting revenue or he'd be losing money.

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No the renter does not pay property taxes. If the place is empty for six months - is the next renter responsible for the 6 months they didn't live there? No the owner is

Renters do not pay property taxes

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I bet you think businesses pay taxes as well, huh?

MookieBlaylock said:

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halfastros81 said:

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Maybe renters don't pay property tax directly but the landlords absolutely include the cost in the rent , so indirectly renters do pay property tax.

Maybe another way of saying it is the property tax comes out of what the landlord collects as rent but at the end of the day the landlord absolutely has to figure it into his business expenses and it needs to be covered by offsetting revenue or he'd be losing money.

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No the renter does not pay property taxes. If the place is empty for six months - is the next renter responsible for the 6 months they didn't live there? No the owner is

Renters do not pay property taxes

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If the place site empty for 6 months the owner loses on the mortgage too. In effect the rent becomes CoGS. The renter covers all costs of a profitable landlord.

AggieIce said:

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AJ02 said:

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Obviously the difference would have to be made up elsewhere. Where would that be?

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Consumption tax would be the fairest

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Real fair. Sure.

A few years ago, I went through the amount of property taxes in my county and figured out that to eliminate property taxes and make up for them with consumption taxes would require enormous sales taxes. If I remember correctly, it was something like a 140% sales tax on everything, including groceries.

Imagine buying $100 in groceries and paying an additional $140 in sales taxes.

Around here, though, it wouldn't be too bad. We can easily drive to Oklahoma to buy what we need. I'm not sure that there would be any businesses left in the county, though.

The obvious way to fix that would be for the sales taxes to fixed at some high level and for the state to have the job of splitting up the sales taxes and hand them out based on who needs what.

How much do you think the people in the big cities with lots more sale tax revenue would think about paying sales taxes to hand out to all the rural counties?

Karl Marx would be proud: "From each according to his ability, to each according to his needs."

If you like Marxism, eliminate property taxes and raise sales taxes instead.

AggieIce said:

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AJ02 said:

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AggieIce said:

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AJ02 said:

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Obviously the difference would have to be made up elsewhere. Where would that be?

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Consumption tax would be the fairest

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Trying to imagine how that would be. Would it be across the board on EVERYTHING? Every clothing purchase, every purchase from Lowe's or Home Depot, etc? And how much? Would a $50 pair of jeans now cost $65?

Or is it reserved only for "large" purchases, like vehicles, homes, boats, etc?

I honestly have no real comprehension of just how much tax revenue in Florida is derived specifically from property taxes, and how much you'd have to increase the cost of other goods to offset that.

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Everyone that owns or rents pays property tax, but everyone pays more in goods and services. So I'd imagine that it wouldn't need to be a super substantial amount. Plus with lower mortgages (for those that escrow) and lower rents people won't notice as much at least.

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How about the out of state property owners? With no property taxes, they would not have to pay for those protections paid for with tax revenue. That would be for the suckers who live her to pay more for them.

There is only one tax bill due on property annually. That tax bill is sent to the owner of the property. The owner is responsible for paying that tax bill. The renter pays rent not the tax. Call it what you want but either the owner is not paying property tax or the renter. Regardless there is only one tax bill on the property so one of the parties involved is not paying the taxes owed.

I absolutely despise property tax. Property is the only thing you buy that is taxed annually after the sale. Not only that but you are taxed on unrealized gains to top it off. Put me in the group that would prefer income taxes

Heineken-Ashi said:

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BMX Bandit said:

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Quote:

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People that rent do not pay property tax

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awful nice of those landlords to eat that cost and not bake it into the lease.

hopefully my tenants don't get wind of me being the only landlord not taking a loss on taxes

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You can only get in rent what the market will pay. If property tax goes up and rents don't, how then are landlords passing along the costs?

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As far as "passing on" the tax, no it is not directly passed on, but it obviously is a part of your analysis of whether a property is getting the ROI the investor requires.

I have three rentals in a small neighborhood in a community outside Fort Worth. A couple years ago, the CAD had a reappraisal, that particular neighborhood had a large increase. That increase was warranted based on comparable sales. Even with a decrease in tax rates, my tax bills still jumped over 20%, but the market rents for those houses only increased by 11% in the following year, so in my case, the tax increase was not passed on to the renters.

Aggie Infantry said:

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Just about every state and every county (and parish for LA) have a sales tax already. Typically, basic food stuff (hamburger, beans, veggies, bread, milk, etc...) are exempt along with medications.

1. There would have to be a limit imposed (10%?).
2. Continue exemptions on food basics and meds. But do tax frozen pizza, candy, soda, beer (this would impact me), and other junk food.
3. If the Feds want a national sales tax (all for it), then the limit would have to be increased (to 15%?).

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I think it would likely be at least 25% to replace property taxes with sales taxes.

Estimates from the Fair Tax people to replace the income taxes would be at about 30%.

So figure something over 60%. On everything.

Texas eliminates many food items, but not everyone does. If you shop in Oklahoma, you pay sales taxes on those.

Also, that 60% assumes that nobody changes their spending habits.

I don't know about you, but if faced with a 60% sales tax, my spending habits would certainly change.

rgag12 said:

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If you got rid of property tax then you'd have to massively increase sales tax, and then also expand state government because you'd need apparatus in place to spread the tax out across the state. You'd have a situation where rural police, emergency services, and schools would have zero money and would have to be appropriated money from the urban parts of the state.

Property tax ain't going away.

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Exactly. Property taxes raise quite a bit more in tax revenue in Texas than does sales tax. Eliminate property taxes and the increase in sales taxes would have to be quite substantial.

Kenneth_2003 said:

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You cannot support rural counties or even rural urban transition counties on sales tax.

There isn't enough population to support the businesses necessary to find the local services.

Example... Every ranch has one or more side by sides on the property... Bought in another, urban, county and bright in. I used to live in a mixed urban rural county North of Corpus.
As one of the largest counties in the region, we got a good deal of business in from smaller neighboring counties. Even still everyone frequently had to go to corpus or San Antonio for larger purchases.

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In my area, just about anything you might need except for food or farm supplies, you have to go well outside of the county.

Chet Ripley said:

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Heineken-Ashi said:

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BMX Bandit said:

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Quote:

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People that rent do not pay property tax

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awful nice of those landlords to eat that cost and not bake it into the lease.

hopefully my tenants don't get wind of me being the only landlord not taking a loss on taxes

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You can only get in rent what the market will pay. If property tax goes up and rents don't, how then are landlords passing along the costs?

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As far as "passing on" the tax, no it is not directly passed on, but it obviously is a part of your analysis of whether a property is getting the ROI the investor requires.

I have three rentals in a small neighborhood in a community outside Fort Worth. A couple years ago, the CAD had a reappraisal, that particular neighborhood had a large increase. That increase was warranted based on comparable sales. Even with a decrease in tax rates, my tax bills still jumped over 20%, but the market rents for those houses only increased by 11% in the following year, so in my case, the tax increase was not passed on to the renters.

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Exactly. And that's my point. Of course an investment pro forma assumes rents will outpace expense increases. But working in multifamily, I've seen first hand periods of multiple years where expenses FAR outpace rental gains. In those years, the increased expenses like taxes and insurance are eaten by NOI, not the renter. In other words, the investor cash flow drops and/or the valuation of the property drops. Ideally things would normalize and over time, the revenue would outpace the expenses. But it doesn't always work out like that.

People posting things like "taxes are paid by the renter" are correct in theory. But there is no button we get to push that says "well our taxes are up 5%. Let's go ahead and increase rents 5%". The market has to be able to absorb the rental increase. If it can't, those taxes hurt the owner/investor, not the renter. Ideally, in a situation where that happens, the following year would see a lowering of taxes as the valuation would indicate a low price. But CAD's aren't about that without you putting up a heck of a fight.

MookieBlaylock said:

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AggieIce said:

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AJ02 said:

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AggieIce said:

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AJ02 said:

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Obviously the difference would have to be made up elsewhere. Where would that be?

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Consumption tax would be the fairest

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Trying to imagine how that would be. Would it be across the board on EVERYTHING? Every clothing purchase, every purchase from Lowe's or Home Depot, etc? And how much? Would a $50 pair of jeans now cost $65?

Or is it reserved only for "large" purchases, like vehicles, homes, boats, etc?

I honestly have no real comprehension of just how much tax revenue in Florida is derived specifically from property taxes, and how much you'd have to increase the cost of other goods to offset that.

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Everyone that owns or rents pays property tax, but everyone pays more in goods and services. So I'd imagine that it wouldn't need to be a super substantial amount. Plus with lower mortgages (for those that escrow) and lower rents people won't notice as much at least.

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People that rent do not pay property tax

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You hear that often enough, but it is totally wrong. Landlords do take property taxes into account. The renter may not pay property taxes to the taxing jurisdiction, but he definitely does pay them to the landlord and then the landlord to the taxing jurisdiction.