Florida weighs ditching property taxes and sticking Canadians with the bill

dabinat

Something tells me federal taxpayers (or more precisely, those in blue states) will end up footing the bill for this.

silverFork

It is not a bad idea to have Canadians completely diverge from US economy. Sell it and take your money back to Canada. Nevertheless, Canadians own something like 500k properties of 7M-10M properties in Florida. The $12B of tax deficit carried by those properties alone would raise their taxes to $24k a year per year for $300k property; Good luck collecting. In 4 years they would lose $100k of property price to taxes so its a no brainer that they would sell and get out and they would never look back. Canadian Snowbirds will obviously choose places like Mexico to just rent; why buy. They are going to transfer the ownership to Americans and then what? Then the deficit would even rise faster to $13B .

jleyank

If they don’t have a property or wage tax, how are they going to pay for any state or local services? Their sales tax isn’t particularly high… Are they going to try and do it on the backs of tourists and non residents? Risky, as there’s lots of places to go that are warm on the ocean.

exabrial

Property taxes are the worst kind of taxes. Nobody should be fined just for owning something. Once it's taxed once, it should never be taxed again.

dlcarrier

I think a large property tax deduction makes much more sense than a large income tax deduction. (Although a universal deduction that lets you apply to any taxes makes the most sense.) For someone who is retired or incapable of working, property taxes can far exceed the cost of food and utilities, and income tax deductions do them no good. Of course, there's no guarantee that anyone will own their own property, but making it an option for retirement planning makes a self-sustaining retirement much more likely, especially so for those who have to retire unexpectedly, due to illness or injury.

jdlshore

For those that didn’t read the article, there’s a constitutional amendment on the ballot that will eliminate or drastically reduce property taxes for permanent residents’ primary residence. The income will be made up by allowing property taxes on other property (AirBnb, rentals, commercial, second homes, etc.) to increase by 5% per year. It requires a 60% majority but seems likely to pass. I always find it interesting to think about second-order consequences of actions like this. Here’s some I can think of: 1. Canadians sell their winter homes and leave the state in droves. They’re already upset about Trump’s political rhetoric. 2. Home prices plummet as stock floods the market. This is good for people who want to buy their first home. Many of these homes are in locations attractive to retirees. 3. Rental costs start increasing steadily to cover the increased taxes. This pushes people to buy homes, stabilizing home prices, but at a lower rate than before. 4. Small businesses catering to retirees and vacationers struggle as their customer base evaporates. Small businesses catering to new homeowners flourish. 5. Local government across the state are underfunded. The 5% yearly increase isn’t enough to cover the loss of income for many years to come. This either results in loss of services and blight or other taxes going up significantly. I’m guessing local sales taxes, but I don’t know what funding options exist. Schools are hit particularly hard. — With housing shortages across the coasts, taxing secondary residences, AirBnb, etc. actually does seem like a good idea. Vancouver BC did it to combat Chinese investment homes that were standing empty, and I believe it worked out well for them. I’m not sure how this will work out for Florida. I’m not confident it was well thought-out, but that may just my bias that Trumpers are fueled more by rage and greed than sense. It will be interesting to see how this plays out. I hope things work out for people in Florida.

MiroslavPokorny

Why dont they just shutdown those socialist/communist public roads ? Florida must be spending billions on them and nobody is paying for their usage.