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Neutral Property Taxation

Author

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  • Richard Arnott

    () (Boston College)

Abstract

This paper investigates property tax systems (linear taxes on pre-development land value, post-development structure value, and post-development site value) from a partial equilibrium perspective. Particular attention is paid to characterizing property tax systems that are neutral with respect to the timing and density of development and to calculating the deadweight loss from non-neutral property tax systems.

Suggested Citation

  • Richard Arnott, 1998. "Neutral Property Taxation," Boston College Working Papers in Economics 411., Boston College Department of Economics.
  • Handle: RePEc:boc:bocoec:411
    Note: An earlier version of this paper was circulated as BC WP 352.
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    File URL: http://fmwww.bc.edu/EC-P/wp411.pdf
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    References listed on IDEAS

    as
    1. 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.
    2. Paul A. Samuelson, 1964. "Tax Deductibility of Economic Depreciation to Insure Invariant Valuations," Journal of Political Economy, University of Chicago Press, vol. 72, pages 604-604.
    3. Richard Arnott & Petia Petrova, 2006. "The Property Tax as a Tax on Value: Deadweight Loss," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 13(2), pages 241-266, May.
    4. Chinloy, Peter, 1979. "The estimation of net depreciation rates on housing," Journal of Urban Economics, Elsevier, vol. 6(4), pages 432-443, October.
    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.
    6. 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 859-868, August.
    7. 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.
    8. 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 161-169, February.
    9. Skouras, A, 1978. "The Non-Neutrality of Land Taxation," Public Finance = Finances publiques, , vol. 33(1-2), pages 113-134.
    10. Mills, David E., 2001. "Land value taxation," Regional Science and Urban Economics, Elsevier, vol. 31(6), pages 765-770, November.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Richard Arnott & Petia Petrova, 2006. "The Property Tax as a Tax on Value: Deadweight Loss," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 13(2), pages 241-266, May.
    2. 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.
    3. repec:kap:itaxpf:v:24:y:2017:i:2:d:10.1007_s10797-016-9403-6 is not listed on IDEAS
    4. Bimonte, Salvatore & Stabile, Arsenio, 2015. "Local taxation and urban development. Testing for the side-effects of the Italian property tax," Ecological Economics, Elsevier, vol. 120(C), pages 100-107.
    5. Caren Sureth & Ralf Maiterth, 2008. "The impact of minimum taxation by an imputable wealth tax on capital budgeting and business strategy of German companies," Review of Managerial Science, Springer, vol. 2(2), pages 81-110, July.
    6. Lyytikäinen, Teemu, 2009. "Three-rate property taxation and housing construction," Journal of Urban Economics, Elsevier, vol. 65(3), pages 305-313, May.
    7. 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.
    8. Richard Arnott & Huiling Zhang, 2015. "The Aggregate Value of Land in the Greater Los Angeles Region," Working Papers 201506, University of California at Riverside, Department of Economics.
    9. Don Fullerton & Garth Heutel, 2010. "The General Equilibrium Incidence of Environmental Mandates," American Economic Journal: Economic Policy, American Economic Association, vol. 2(3), pages 64-89, August.
    10. Alex Anas, 2003. "Taxes on Buildings and Land in a Dynamic Model of Real Estate Markets," Urban/Regional 0302004, EconWPA.
    11. Niemann, Rainer & Sureth-Sloane, Caren, 2015. "Investment effects of wealth taxes under uncertainty and irreversibility," arqus Discussion Papers in Quantitative Tax Research 192, arqus - Arbeitskreis Quantitative Steuerlehre.
    12. Tomlinson, Peter, 2001. "Land Value Taxation: Can It and Will It Work Today?: Dick Netzer (ed.), Lincoln Institute of Land Policy, Cambridge (MA), 1998," Regional Science and Urban Economics, Elsevier, vol. 31(5), pages 634-641, September.
    13. Wassmer, Robert W., 2016. "Further empirical evidence on residential property taxation and the occurrence of urban sprawl," Regional Science and Urban Economics, Elsevier, vol. 61(C), pages 73-85.
    14. Rainer Niemann & Caren Sureth-Sloane, 2015. "Investment Effects of Wealth Taxes under Uncertainty and Irreversibility," CESifo Working Paper Series 5610, CESifo Group Munich.

    More about this item

    Keywords

    property taxation; site value taxation; land taxation; neutrality;

    JEL classification:

    • H2 - Public Economics - - Taxation, Subsidies, and Revenue

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