Monday, October 26, 2020

How Much Tax Does Your Neighbor Pay?

Earlier this month The Bay Area Property Tax Map was released to show how much property tax is paid by individual buildings in the Bay Area. Using the map everyone can see how much property tax is paid by every single building. Therefore home owners can use the map to see how their property tax compares to the amount paid by their immediate neighbors.

In California property taxes are determined by a property's value. This seems like an entirely fair way to determine the level of property taxes. However California also has Proposition 13, which means that a property's assessed value is frozen at the moment of purchase. The result of Proposition 13 is that people living in some of the Bay Area's richest neighborhoods have their property tax subsidized by everybody else.

You can find out how much property tax subsidy your neighbors receive on The Tax Fairness Project's interactive map. This map shows the property tax subsidies received by each property in the Bay Area as a result of Prop 13. A property's subsidy is defined as the difference between the actual tax paid and the tax that should be due if the property was assessed at market value.

On this map you can see where property taxes are being subsidized the most. These tend to be areas where property values have sky rocketed compared to other neighborhoods. Of course the areas where property values have risen the most tend to be in already affluent neighborhoods. Those Californians unfortunate enough to live in poorer neighborhoods tend not to live in properties which have seen the same level of increase in value. Which means that the poorest Californians tend to receive the lowest amount of property tax subsidy, while their richer neighbors receive the most.

No comments:

Post a Comment