Quote:
Originally Posted by biguc
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Those will not really answer the question, which was mostly rhetorical. The point is that there are different things to consider and different ways to define “success” of the policy. What represents a successful policy to one person will not to another.
For example, one of the things I disagree with in the UK is the absence of an annual property tax (there is a council tax but this is not at all the same). Old people love this, because they pay no taxes on property that they’ve owned for many years. But the downsides of it are:
- it’s harder to purchase a first home (or upsize after a few years, eg when you start a family) because of the very high up-front tax on purchases;
- there is no incentive to downsize for older empty nesters (or widows/widowers) which constrains supply;
- there is no benefit to the community as a whole from rising property values (which would otherwise translate into higher tax revenue to pay for services);
- there is virtually no holding cost (absent a mortgage), so a large amount of real estate (especially in Central London) is just owned as a financial asset; and
- these properties are passed from people who have done nothing but get lucky as real estate prices rose, to their kids that have done nothing but be lucky enough to be born to them, with no taxation.
On the other hand, little old ladies who bought a house in 1965 that’s now worth millions don’t have to pay higher annual tax assessments because the valuation goes up. My view is this is a non-problem… just borrow against the value of the house. But unfortunately old people control the political system and lottery winners don’t like surrendering their winnings.