Here is a chart from the Lehigh County website, comparing millage rates for different taxing bodies in Allentown:
Notice how in the first group, the millage rate for city land is higher than the millage rate for city buildings.
When Allentown started charging different rates for land and buildings, three out of four property owners received a tax cut.
People who don’t consume a lot of land – think working class neighborhoods with a higher building-to-land ratio, modest lawn, etc – saw their taxes go down. The minority of people who own properties with lots of unimproved land saw their taxes go up. It’s a nice revenue-neutral progressive tax cut.
Don’t take my word for it. Let’s hear it from Pat Toomey, recommending the land value tax to Lebanon, PA:
It’s too bad that the Allentown School District didn’t adopt the land value tax when the city of Allentown did, since school taxes are the biggest local tax for most people, but it’s never too late!
All the district has to do is split the real estate tax into land and buildings. Copy Allentown’s spread, and 75% of ASD taxpayers will see their taxes reduced.
I bet BASD and EASD taxpayers think they could use a tax break too. Most Democrats would probably agree that we should make federal taxes more progressive, but aren’t as active about pushing for progressive taxation in local government. That’s too bad. It’s not preordained that local taxes have to be regressive, and it’s probably easier to get stuff like this done at the local level than it will be to let the Bush tax cuts expire.