The federal government has a power to tax limited only by the “No capitation, or other direct tax shall be laid unless in proportion to the census or enumeration herein before directed to be taken.”
At least one government can take 1% of the value of your house, or 2%.
Why not 3% a year? or 4%? or 8%?
Rates of property tax in major NE cities were very high in the 1960s. My father said a $60,000 house in Albany, NY in 1968 would have paid $3,000/year, i.e. 5%.
Italian tasso = rate
Italian tassa = tax
“do you support the notion that taxing unrealized gains is an illegal takings?”
Congress can tax the length of my arm, at the rate of 10 cents an inch, or anything else I might have.
The way around the direct tax clause is to tax at higher rates in less wealthy states and then give out tax rebates to equalize the effective tax rates.
Article I, Section 8 does not require tax rates to be equal by state.
The Articles of Confederation required states to levy a property tax by value and hand the funds over to Congress. That would be an indirect tax. Congress had the power to collect it from all states when the Constitution came in effect and some states (VA, NY, NC, RI) had not ratified the Constitution.
Taxing income is one thing; taxing property (like ownership shares in a company) is another. Taxing real property is yet another level. California had to institute proposition 13 because property taxes were rising so fast that people had to sell their property to pay the taxes on it. That was a de facto confiscation of private property for government "use" disguised as a tax.
I think this has it roots in the Kelo vs. New London, CT decision where SCOTUS reinterpreted "public use" as "public good." This let city councils declare perfectly fine neighborhoods as "blights" on the community because the people who owned the property weren't using it in ways that generated enough taxes to the city's liking. Cities wanted to take property from one private owner and give it to another private owner who would put it to better use for the "public good" that would come from an increased tax base. In other words, it would be a taking disguised as a tax.
This was an abomination of a decision. Eminent domain abuses became widespread. The worst case of it was on the intracoastal waterway area of Florida's Atlantic coast. City councils wanted to "blight" whole communities of 1970s style "Florida homes" that were common at the time and still owned by the original purchasers or their families and were paying common property tax on their homes.
Developers wanted to take that property so they could build luxury yacht clubs for the wealthy that would generate higher taxes for the cities. "The property was too good for the people who currently owned it," was the common complaint by the existing homeowners. The residents took the city to court and won.
Article I, Section 8 does not require tax rates to be equal by state.
No, but the 5th amendment prohibits the taking of private property for public use without just compensation. A tax that is intended to force the divesture of the thing being taxed is a de facto taking with just compensation because the owner is left without the property, no compensation, and less than the property's worth after the tax is deducted.
-PJ