Arecent Harris poll concluded that the number-one concern among those considering the purchase of a Florida home is property taxes. There is a solution. Abolish them. Lawmakers considered this option in June. They reported the lost revenue could be recouped through a 2 1/2 percent increase in sales tax. I think we should revive this discussion for two reasons: The taxes are unfair, and they are a huge drag on our economy. First, property taxes are fundamentally unfair. They are calculated on the assumption that the mass appraisal system is accurate. It is not. A few years ago, I analyzed hundreds of vacant lots that sold within 30 days of the county’s valuation date. There was a median difference of 31 percent between the appraised price and actual selling price. Secondly, it is unfair to burden a single class of citizens with the cost of services provided to everyone. Is it only property owners who benefit from police, firemen, paved roads, teachers, etc.? Thirdly, the property tax system itself is permeated with inequities. The “Save Our Homes” exemption is a gold mine to some, but every dollar saved is paid for by nonhomesteaders. The “super exemption” is a progressive tax system that may as well be administered by Robin Hood. Now, let’s consider what would happen if we abolished property taxes in favor of a 2 1/2 percent sales tax hike. First, everyone who uses our services would pay for our services. Florida is the most visited state in the country. We are a huge international destination. For example, Englewood’s population nearly triples during season. A small sales tax increase would distribute the cost of services to everyone who uses them. What about the argument that a sales tax increase would hurt the working class? Guess what? There is a huge segment of the working class that’s not working right now because property taxes have contributed significantly to the implosion of real estate, housing and many other industries. In fact, the elimination of property taxes would create a boon to Florida’s economy. Property taxes are a worldwide curse. The abolition of property taxes would turn Florida into a worldwide mecca for homeowners, retirees, snowbirds and industries sensitive to the cost of home ownership. No state income tax. No property tax. Wow. The real estate market would become liquid again, as would the homebuilding industry and other sections of the economy directly dependent upon them. This would be further bolstered by the restoration of full portability, releasing the pent-up demand. Property taxes are fundamentally unfair. They have created a huge drag on major segments of our economy, including real estate and housing. Let’s abolish them and show the rest of the country how you bust your way out of a housing slump while becoming “the place” to buy. Brett Slattery is a Realtor with Keller Williams Realty. His contact, Web and blog are at www.BrettSlattery.com.
