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jltsiren 2 hours ago

People often vote to support new housing, as long as the entire system works reasonably well.

My solution was to widen the tax base to make the system work better.

The incentives around property taxes do not support significant new construction. If housing becomes more affordable, tax revenue per capita goes down, while local government spending stays the same or increases. Local governments should therefore not rely too much on property taxes.

Income taxes, on the other hand, are good. You are taxing things you want to grow, and you get more tax revenue when your policies are good to the people. Local governments might want to collect more income taxes and less property taxes.

When the demand for housing is high, zoning creates significant windfall to the landowner. Some of this windfall can be taxed to support infrastructure construction.