Our State Constitution implies, and sometime states, that all of our state laws/statutes shall protect us and treat us justly. When it comes to taxes, the constitution is very specific. In Section 1 of Article X it states that “Taxes shall be uniform upon the same class of subjects and shall be levied and collected for public purposes”
As individual subjects we fit in one or more of the three major tax classifications, the income tax, the sales tax and the homestead property tax. The income tax and the sales tax are straight forward in their concept and easily comply with the uniformity clause. However, our homestead property tax concept is not straight forward and does not comply with the uniformity clause.
Unlike the income tax and sales tax that is based on one variable for tax levies, the homestead property tax is based on variables and assumptions. With such a mix it is impossible to achieve any kind of uniformity for the homestead property tax burden.
One of the variables is the unrealized capital gains (our home value) which is different for all of us and may be different from what the assessor has set it at if the home’s capital gains were realized. Aside from the inability to establish a correct capital gains, it is an extremely convoluted process to assess a tax on something that we have not realized as a financial gain.
However, our government has a very cavalier attitude about taxing our unrealized capital gains. It simply assumes that all of us have some additional funds to pay for their assessed tax burden. And if we don’t have the funds, we must face the consequences of losing our homes.
This and the two previous posts illustrates that the status quo homestead property tax in Minnesota goes against our concept of home ownership in a free society that is protected by a constitution. However, there is a simple solution to adjust the status quo homestead property taxes via the legislature or the courts to have it comply with the intent of our State Constitution.
In my future blog posts, I will comment on the options that are open for us. But mean time, I would like to know if there is anybody that is against a fair homestead property taxes.
I never have paid much attention to the property tax. But now I can see why I have been irritated with it. I read your previous posts and it brings a question to my mind. Why is the legal profession allowing this to happen?
ReplyDeleteCheated,
DeleteYou missed some of the comment in the previous posts. Someone asked a similar question that I answered. Just try and ask any lawyer about the constitutionality of our homestead property tax. See what kind of an answer you will get.
I am sorry to see a movement that labels itself "Property Tax Justice" adopt a solution that comes from Marxism, Communism, and socialism. Marxism says, "From each according to his abilities, to each according to his needs." That is what you are advocating with your "ability to pay" principle.
ReplyDeleteA much better system, if you're going to allow for property taxes at all, would be to tax land square footage at one rate and the building square footage at another. All rates would be uniform throughout the state.