No Property Taxes

[lockmat]

This article talks about how Stafford has done well without property taxes.

Do yall think Houston could do this? Should they do this? Pros and cons?

http://www.chron.com/disp/story.mpl/front/6464089.html

[ihop]

I don't know about Houston, but maybe Mo City should look into this, given the extremely high density of churches there that seems to be plaguing them.

[Ross]

I suspect that Houston is too large to get by on just the sales tax. Public safety expenditures exceed current sales tax receipts. For FY2009, sales taxes are estimated at $527 million, while property taxes are $878 million. Doubling sales taxes would not elimiante the property tax.

[RedScare]

"It

[TheNiche]

Poor Mrs. Hamilton. She replaced her tax deductible property tax with an additional 1% sales tax, and thinks it is "a tremendous benefit". It is...for the federal government. Let's do the math. $60 x 12 months = $720 a year savings on property taxes. In the 25% tax bracket, that $720 property tax would have saved her $180 on her income taxes, meaning the actual tax hit would only be $540 a year. But, they did not get rid of property taxes. They simply traded them for a 2 cent sales tax (Houston is 1 cent). Assuming she spends $2000 on taxable items per month, the additional sales tax would be $240 a year. So, her total savings is $300, or $25 a month, not $60. If her family buys more than $2000 in taxable items, the savings is even less. Color me unimpressed.

Even worse, how do you replace lost revenue during a recession, when people buy fewer goods? That's fine for a city of 20,000, but a city of 2.25 million cannot be so flippant about its revenue streams. While I know it is popular to delicate flower and moan about property taxes, I am glad my municipal government has the means to raise the necessary revenue to run the city. I would not be in favor of moving to an unreliable revenue source like sales taxes.

Stafford is a small municipality with a fairly large industrial presence, and a lot of large commercial sales are taxable. Meanwhile, residents of Stafford do relatively little of their shopping in Stafford because its retail base is limited in size and because most of their options are either in Houston or Sugar Land. In effect, Stafford has shifted the burden of taxes more to its industrial base. The voting residents of Stafford win out.

However, your concerns over the stability of revenue are well justified. By state law, they can't raise their tax rate above where it presently is. If sales tax income declines at all, they'll have to finance their expenditures through other means.

[UrbaNerd]

Stafford has a decent sized retail base actually. The Fountains, and all of the restaurants on both sides of US 59 between US 90 all the way to the County/Houston line are all within the Stafford city limits, if I am not mistaken. However, the industrial base is indeed much larger than the retail base, with nearly half of the city limits covered in industrial parks.

Of course, they don't have as much "upscale" retail as Sugar Land does, due to the fact that their demographics consist of less affluent consumers, and also because the population there fluctuates greatly throughout the day. This can easily explain why they have so many "places office park workers like to go to for lunch". It's our own version of the movie Office Space!

But I'm sure you already know most of this stuff...just wanted to put some of my persona observations on here.

[TheNiche]

Stafford has a decent sized retail base actually. The Fountains, and all of the restaurants on both sides of US 59 between US 90 all the way to the County/Houston line are all within the Stafford city limits, if I am not mistaken. However, the industrial base is indeed much larger than the retail base, with nearly half of the city limits covered in industrial parks.

Of course, they don't have as much "upscale" retail as Sugar Land does, due to the fact that their demographics consist of less affluent consumers, and also because the population there fluctuates greatly throughout the day. This can easily explain why they have so many "places office park workers like to go to for lunch". It's our own version of the movie Office Space!

But I'm sure you already know most of this stuff...just wanted to put some of my persona observations on here.

Oh yeah, forgot about the Fountains being within Stafford. That is a pretty significant concentration of retail. Still, I have to believe that a majority of the customers there don't actually live in Stafford or have exposure to the City's property tax. So again, residents probably do come out ahead.

[CDeb]

Let's do the math. $60 x 12 months = $720 a year savings on property taxes. In the 25% tax bracket, that $720 property tax would have saved her $180 on her income taxes, meaning the actual tax hit would only be $540 a year.

But that's only if your total deductions rise over the standard deduction, right?

It's usually close for us because we don't pay much mortgage interest.

[KatieDidIt]

But that's only if your total deductions rise over the standard deduction, right?

It's usually close for us because we don't pay much mortgage interest.

For property taxes I think The City of Houston pays much less than other areas around here. But I sure wish they stop hiking it every year to get their revenue.

[Fringe]

Stafford cuts corners in many areas such as their volunteer fire department.

[TheNiche]

For property taxes I think The City of Houston pays much less than other areas around here. But I sure wish they stop hiking it every year to get their revenue.

Yeah, the City of Houston's taxes are pretty low. But the lowest-taxed cities are the Villages, Bellaire, and West U. They have such consistently-high property values per household and have so little need for city services as compared to Houston that they can get away with very low property tax rates. So low are their rates that it actually reinforces their standing as the place that people would want to build hugely expensive mansions, because they'd be taxed less there than just about anywhere else in the metropolitan area.

On the flip side, there are the refinery cities such as Pasadena, Deer Park, La Porte, and Baytown, where they have a hugely capital-intensive industrial tax base. Their property tax rates are higher than any other city because the disproportionate burden of the taxes are levied on refiners. And for cities their size, they typically are able to provide superior services.