This file is part of IDEAS, which uses RePEc data


[ Papers | Articles | Software | Books | Chapters | Authors | Institutions | JEL Classification | NEP reports | Search | New papers by email | Author registration | Rankings | Volunteers | FAQ | Blog | Help! ]

Neutral Property Taxation

Author info | Abstract | Publisher info | Download info | Related research | Statistics
Author Info
Richard Arnott (Boston College)

Additional information is available for the following registered author(s):

Abstract

A major difficulty in implementing land/site value taxation is imputing the land value of builton sites. The literature has focussed on two alternatives. The first, residual site value, measures postdevelopment site value as property value less structure value, measured as depreciated construction costs. Residual site value would be relatively easy to estimate, but residual site value taxation is distortionary, discouraging density. The second, raw site value, measures post-development site value as "what the land would be worth were there no building on the site (though in fact there is)". Raw site value taxation is neutral (does not distort the timing and density of development), but the estimation of raw site value would be complex so that assessment would likely be less fair and more arbitrary, contentious, and prone to abuse. This paper asks the question: Is it not possible to design a property tax system (taxation of predevelopment land value, post-development structure value, and post-development site value at possibly different rates) that employs the administratively simpler residual definition of post-development site value and achieves neutrality? The paper provides an affirmative answer, characterizes the tax rates that achieve neutrality, and briefly discusses issues of practical implementation.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://repositories.cdlib.org/cgi/viewcontent.cgi?article=1025&context=iber/bphup
File Format: application/pdf
File Function:
Download Restriction: no

Publisher Info
Paper provided by Berkeley Program on Housing and Urban Policy in its series Berkeley Program on Housing and Urban Policy, Working Paper Series with number 1025.

Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Length:
Date of creation: 27 Jun 2006
Date of revision:
Handle: RePEc:cdl:bphupl:1025

Note: oai:cdlib1:
Contact details of provider:
Postal: F502 Haas, Berkeley CA 94720-1922
Phone: (510) 642-1922
Fax: (510) 642-5018
Email:
Web page: http://repositories.cdlib.org/iber/bphup/
More information through EDIRC

For technical questions regarding this item, or to correct its listing, contact: (Christopher F. Baum).

Related research
Keywords:

Other versions of this item:

This paper has been announced in the following NEP Reports: References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Paul A. Samuelson, 1964. "Tax Deductibility of Economic Depreciation to Insure Invariant Valuations," Journal of Political Economy, University of Chicago Press, vol. 72, pages 604. [Downloadable!] (restricted)
  2. Bentick, Brian L, 1979. "The Impact of Taxation and Valuation Practices on the Timing and Efficiency of Land Use," Journal of Political Economy, University of Chicago Press, vol. 87(4), pages 859-68, August. [Downloadable!] (restricted)
  3. Kanemoto, Yoshitsugu, 1985. "Housing as an asset and the effects of property taxation on the residential development process," Journal of Urban Economics, Elsevier, vol. 17(2), pages 145-166, March. [Downloadable!] (restricted)
  4. Chinloy, Peter, 1979. "The estimation of net depreciation rates on housing," Journal of Urban Economics, Elsevier, vol. 6(4), pages 432-443, October. [Downloadable!] (restricted)
  5. Sweeney, James L., 1974. "A commodity hierarchy model of the rental housing market," Journal of Urban Economics, Elsevier, vol. 1(3), pages 288-323, July. [Downloadable!] (restricted)
  6. Arnott, Richard J & Lewis, Frank D, 1979. "The Transition of Land to Urban Use," Journal of Political Economy, University of Chicago Press, vol. 87(1), pages 161-69, February. [Downloadable!] (restricted)
    Other versions:
  7. Capozza, Dennis & Li, Yuming, 1994. "The Intensity and Timing of Investment: The Case of Land," American Economic Review, American Economic Association, vol. 84(4), pages 889-904, September. [Downloadable!] (restricted)
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Alex Anas, 2003. "Taxes on Buildings and Land in a Dynamic Model of Real Estate Markets," Urban/Regional 0302004, EconWPA. [Downloadable!]
  2. Richard Arnott & Petia Petrova, 2002. "The Property Tax as a Tax on Value: Deadweight Loss," Boston College Working Papers in Economics 532, Boston College Department of Economics. [Downloadable!]
    Other versions:
  3. Salois, Matthew J. & Moss, Charles B., 2008. "Testing for Hyperbolic Discounting in a Panel of U.S. Agriculture," 2008 Annual Meeting, February 2-6, 2008, Dallas, Texas 6808, Southern Agricultural Economics Association. [Downloadable!]
  4. Jyh-Bang Jou & Tan Lee, 2008. "Neutral Property Taxation Under Uncertainty," The Journal of Real Estate Finance and Economics, Springer, vol. 37(3), pages 211-231, October. [Downloadable!] (restricted)
  5. Jyh-Bang Jou & Tan Lee, 2008. "Taxation on Land Value and Development When There Are Negative Externalities from Development," The Journal of Real Estate Finance and Economics, Springer, vol. 36(1), pages 103-120, January. [Downloadable!] (restricted)
Statistics
Access and download statistics

Did you know? All full texts are decentralized with the publishers, none reside on this server, thus making it possible to offer this service for free to all parties.

This page was last updated on 2009-10-17.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.