Recently, Albuquerque resident David L. Jackson replied to an article by RGF scholar Micha Gisser’s article on property taxes. As you may recall, Gisser’s basic point was that “If in the marketplace your home is worth twice as much as my home, the dollar value of your property tax must be twice the dollar value of my property tax.”
Jackson disagrees, and, while he certainly makes some valid points in asserting that a system involving property tax caps like the one New Mexico adopted in 2001 can be useful, his assertion that we should adopt “progressive” tax rates for property taxes as we have done with income taxation in this country is wrongheaded and dangerous. After all, a rich person who lives in a bigger house (say, twice as expensive as a poor person) will already pay twice as much in property taxes. The last thing we need to do is to further ratchet up rates on certain segments of the population simply because we can.
New Mexico should consider applying the 3% tax cap to everyone or it should throw it out and follow Gisser’s model. Regardless, it is time for the Legislature to address “Tax Lightning.”
One Reply to “There’s a Reason for Valuation Caps…”
The current cap creates a protected class, long time property owners. Taxes should be applied as fairly and equitably as possible. Instead of a cap have a higher exemption amount for those the cap was trying to protect. If you want to protect seniors give them a $100,000 exemption or something.
If the cap is eliminated and every one’s assessments went up the overall tax rate could drop to account for the increased tax base.