	▲	hungryhobbit 5 hours ago
		"None of this is really about billionaires; California reaches for exotic taxes because its normal one has been broken since 1978." The author then goes on to talk about CA's property taxes ... but LAND HAS NOTHING WHATSOEVER TO DO WITH THE BILLIONAIRE'S FORTUNES!!! Zuckerberg did make his money trading property, he made it through companies. Nothing about California's property tax decisions have anything to do with 99.9% of Zuck's (and others') wealth not being taxed!
	▲	simoncion 3 hours ago \| parent \| next [-]
		> Nothing about California's property tax decisions have anything to do with 99.9% of Zuck's (and others') wealth not being taxed! That may be true, but you appear to have missed the part of the sentence you quoted that came after the semicolon: `California reaches for exotic taxes because its normal one has been broken since 1978.` Property taxes make up a large portion of many states' tax income. 1978's Proposition 13 made it so that California is -more or less- unable to tax the actual value of any property in the state. Wealthy people who've held on to property for decades get to borrow against the "market value" of that property, but the value of the property used to calculate the tax owed to the state only increases at a maximum of something like 2% per year. This means that you'll see long-term landlords (and holding companies) getting the financial benefits of a -say- multi-million dollar property, but the state only gets the tax of -say- a multi-deca-thousand dollar property. Because of Proposition 13, property tax increases in California will affect an extremely tiny slice of landowners, [0] so it must turn to other mechanisms when it needs more tax revenue. In regards to private "wealth creation", it turns out that money is fungible and you absolutely can built a bunch of wealth off of a mortgage if the "market" value of that property has increased by a huge amount, but the costs of holding that property haven't increased much at all. [0] This doesn't contradict what I've said, I've just left out some details. A quick summary: Ignoring a few exceptions, when a property changes ownership its property tax is adjusted to be based on the current "market" rate. When nontrivial improvements are made to a property, the property tax is adjusted to account for the "market" value of only those improvements. [1] Some "clever" people have been known to get around the "property changes hands" trigger by making the property be owned by a company and distributing private shares in that company. Want out? Get rid of all of your shares. Want in? Get shares from someone who already has them, or maybe convince those who are in to make more for you. The property is still owned by the company, so its tax is not adjusted. [1] It's important to note that repairs are not improvements. It's also important to note that the government can choose to ignore all of these rate-reset rules whenever it wants, as it did when all those extremely wealthy people in LA got their houses burned down in that big wildfire that hit LA.
	▲	kelnos 3 hours ago \| parent \| prev [-]
		So what? The goal is to fund the government. You may want to stick it to Zuck and other billionaires (and I admit, there's appeal to that), but if fixing our broken property tax system will fund the government (without causing mass displacement as people's property taxes go up), then we should do that. It's a fix to a structural problem, and a fix that will be durable and be reliable in the future. Taxing billionaires is not a durable fix to budget deficits. The article very clearly explains why this is the case.