In response to a letter at the Mercury News about Prop 13; the letter is at the bottom of this blog.
Property taxes are the main reasons Californians 65 and older won’t move. According to the last census, there are over 1,750,000 homeowners here in California 65 and older. This locks in outdated assessments, thus denying the community the additional tax revenues that would be paid by new homeowners.
Seniors over 65 should be allowed to move anywhere in California without paying increased property taxes, as long as they are moving to a less expensive residence.
State and Federal capital gains taxes should be eliminated for sale of a home by seniors 65 and older to stimulate the middle to upper class home sales. There are 1,400,000 plus homeowners 55 and older. There are millions of California homes that have appreciated more than the current 250,000 per person capital gain exemption; homeowners won’t sell because of the state income tax combined with the Federal (24.3%) tax rate. Increased property taxes will structurally increase revenue
Monte Sereno, CA
Letter in the Mercury News:
Something must be done about Prop. 13
There is little doubt that one of the consequences of Proposition 13 has been a severe decline in California property tax revenues. Although the original intentions of this legislation may have been justified, the results produced a system that is inequitable and irrational. There are far better ways to ensure that individual homeowners are not forced out of their homes due to excessive annual increases in property tax, and there are far more equitable systems for ensuring that corporations contribute their fair share of property tax.
We should demand that legislators create a simple, equitable property tax law that protects vulnerable individual homeowners, but allows the state to collect adequate revenues to support those vital community services that we all depend on, such as public education. Rather than propose ways to tinker with a bad system, let’s create a new one. Doing nothing is simply irresponsible.