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sigh. Minn. is not "losing" revenue unless people are breaking the law. If they are breaking the law, then the state needs to go after law breakers.
What may be happening is that Minn. tax payers are in fact abiding by the law and investing where they legally can in a way that does not generate tax revenue in for the state.
Now here are the options. do nothing and keep high tax payers happy.
change the law to recoop part or all of this 2B dollars. Now their just might be some down stream effects. Some high tax paying citizens might opt to move to a more tax friendly location (Texas is open for business by the way and we like people with enough money to invest overseas and we dont want to take that from you).
Guess what? Your state might lose a LOT more than that 2B by getting greedy.
PS dear rich person, Texas winters are way warmer than Minn. And we have way more days when you can golf.
Minnesota IS losing out on this revenue. Minnesota's citizens (the ones that use state highways, send their kids to state schools, use public libraries, enjoy state sponsored projects and parks) are moving their money offshores to avoid paying their share of taxes that fund the projects they use costing the state billions. Now...you are correct in that they aren't doing anything illegal...I can't argue that. However, I don't think altering the tax code to increase tax equality in the Gopher State will run people off in droves...maybe a few but not enough to matter. The fact of that matter is that taxes are still EXTREMELY low compared to their historic averages...Reagan and Bush blew the debt up by destroying our revenues. It isn't unfair or greedy IMO for the state to seek to recover some of the funds that have been cut.
To some, trickle down economics actually works...it's essentially what created the middle class during the industrial age.
Now Laissez Faire economics is a different game altogether.
Uh... you need to do some serious reading about the Robber Barons, unions, etc. Clearly you must've been home with mono when they covered that chapter of U.S. history.
A reduction in just property taxes doesn't necessarily mean a landlord is doing better. Other taxes also apply to rental properties.
Other taxes such as what? Property tax is by far the largest tax component of rent, because rental property receives favorable treatment under the federal income tax.
Which may be offset by individual income taxes or corporate taxes. Taxes on rentals do not exist solely in the property tax realm. Other taxes ALSO apply and ALSO affect the rental prices. You're not accounting for those.
Would you then agree, therefore, that combining a sales tax increase with a property tax cut (very popular with conservatives) is generally a very bad deal for renters?
And would you also agree that rental property is overtaxed, and consequently, that renters bear more than their fair share of taxes?
There's no connection. Why should a landlord reduce his rents simply because he's doing better?
This was the premise of the trickle down theory - make those who are better off even better off, and out of the kindness of their hearts (if there is one), they'll stop being so greedy.
Conservatives say that competition will drive rents downward when landlord costs are reduced. That's what Howard Jarvis told renters when he pitched Prop 13 to voters. That's why renters were sufficiently angry to push local rent controls in California.
Other taxes such as what? Property tax is by far the largest tax component of rent, because rental property receives favorable treatment under the federal income tax.
The difference in property tax between rental homes and owned homes isn't that much. If it were, renting would be a LOT more expensive than owning a home so very few would rent.
Uh... you need to do some serious reading about the Robber Barons, unions, etc. Clearly you must've been home with mono when they covered that chapter of U.S. history.
And clearly you need to learn the difference between crony capitalism and trickle down economics. Robber barons have zero to do with trickle down economics.
Conservatives say that competition will drive rents downward when landlord costs are reduced. That's what Howard Jarvis told renters when he pitched Prop 13 to voters. That's why renters were sufficiently angry to push local rent controls in California.
Are conservatives wrong?
It did lower rents at the time it passed... my Uncle and one of my teachers both supported Prop 13 and both had their rents reduced after it passed...
Rent Control is not Statewide... Prop 13 applies to every assessable property in the State...
Trickle down worked for me...
In high school I worked at specialty auto parts house... I know I benefited from Trickle Down.
Let's face it... no one "Needs" to restore antique or classic cars... many desire to do so and it takes money to make a desire reality...
Tonight's Bay Area news had a segment on the hiring boom in Silicon Valley... it was all about Trickle Down... High Tech has been on a hiring spree which continues to generate new jobs through out the local economy... everything from service to construction... even Home Depot is adding 15,000 jobs in California.
The difference in property tax between rental homes and owned homes isn't that much. If it were, renting would be a LOT more expensive than owning a home so very few would rent.
??? In Michigan, the nonhomestead tax on rental property is 18 mills, which works out to approx $1,500 per year on a typical rental house. You say $1,500 per year isn't that much?
In addition to the explicit cost of trhe nonhomestead tax must be added the adverse effects on renters of its resulting market distortion.
Whenever a home goes on the market, that home is cheaper for an owner-occupant to buy than it is for a landlord to buy, thereby reducing the supply of rental housing (thereby increasing rents) below the supply which would be offered in the absence of the nonhomestead tax.
Last edited by freemkt; 02-07-2013 at 01:57 AM..
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