Saturday, October 07, 2006

No on 1, what on 2?

I got my ballot for the Tennessee general election today. I ripped it open just like it was Christmas. Oh, look at my beautiful yellow ballot.

I've filled it all in. I even voted in the unconstested race. I took the time to laugh at the funny names of some of the independent gubenatorial candidates - like Marivuana Stout Leinoff. Who in the world name their child Marivuana? As it turns out nobody did, she named herself. And I checked out Carl "Twofeathers" Whitaker's website - crap website, at least in Mozilla, but he does have some lovely banners freshly prepared for bloggers such as myself. See:

But I wouldn't advise voting for this long-haired "independnent conservative" living in Sevierville. No sirree.

I voted on the ballot proposition for constituion amendement #1 - the anti gay marriage amendment. I voted no. I will explain why I did so in a future post.

I've voted for everything but Constitution Amendment #2. And I've held off because I don't really understand it. And I don't want to vote for something I don't fully understand.

OK here's what it says:

Shall Article II, blah, blah be changed by including...

By general law, the legislature may authorize the following program of tax relief:

(a) The legislative body of any county or municipality may provide by resolution or ordinance that:

1. Any taxpayer who is 65 years of age or older and who owns residential property as the taxpayer's principal place of residence shall pay taxes on such property in an amount not to exceed the maximum amount of tax on such property imposed at the time the ordinance or resolution is adopted;
2. Any taxpayer who reaches the age of 65 after the time the ordinance or resolution is adopted who ownse residential property as the taxpayer's prinicpal place of residence shall thereafter pay taxes on such property in an amount not to exceed the maxiumum amount of tax on such property imposed in the tax year in which such taxpayer reaches age 65; and
3. Any taxpayer who is 65 years of age or older, who purchases residential property as the taxpayer's principal place of residence after the taxpayer's 65th birthday, shall pay taxes in an amount not to exceed the maximum amount of tax imposed on such property in the tax year in which such property is purchased.

So basically it's a tax freeze on property owned by old people. Old people good, taxes bad, ability to locally vary taxes to take account of local circumstances very good, right?

Well, I'm not so sure.

Why should old people get this benefit? Why not low income people with small children, or veterans, or farmers or UT fans or old Southern families ? (What was that Faulkner short story about the woman who said she didn't have to pay property tax because her father had been a Civil War general and who possibly killed her Yankee carpetbagger husband?)

And, I have to wonder - who is really benefitting from this? Wealthy old people - or wealthy people who are about to be old. And who exactly is about to be old? Why it's the baby boomers - the selfishest generation. Wealthy baby boomers are only too happy to limit taxes on wealth and might even push for an income tax in Tennessee as their wealth increases and their incomes drop. And I have a sneaking suspicion that real beneficiaries will be baby boomer property developers. Just wait and see.

Anyway, I'm inclined to vote NO on 2 - but I'm not going to vote on this proposition and seal my ballot until...let's say Tuesday evening, so I'm open to persuasion until then.


"John Galt" said...

Older people in many established neighborhoods are facing much higher property taxes. Some of it comes from general property value increase but a lot comes from new owners moving to an area and either tearing down and starting over or doing a dramatic remodel. As more of the homeowners move to an area and do this the values rise in general and fixed income folks are caught.

I'll be voting yes.

Anonymous said...

After age 65 a person's income generally does not increase and they use up resources as they supplement social security. Many people are priced out of their homes just by increases in property taxes, especially in urban areas. Yes the rich will benefit most, as they always do.
However, many baby boomers do not have the retirement resources their parents had. Boomers are notoriously poor savers. As a tax professional I see it all too clearly. VolMom

"John Galt" said...

Remember VA. Mom always know best.

Vol Abroad said...

VolMom is not a disinterested party -she is one of those about to be 65 baby boomers - and it just so happens that her husband is over 65. They might be immediate beneficiaries of such a constitutional amendment.

She's already had a lot of government breaks, why should she get more? Why should they constitution be amended so that one group gets a break over another?

"John Galt" said...

"The legislative body of any county or municipality may (emphasis added) provide by resolution or ordinance...

The change doesn't require the freeze, just allows it.

How are council taxes handled in Britain? In the semi-socialist state that is the modern Britain, I suspect pensioners get a break there.

There is precedence for allowing advantages to certain segments of the population that are adversely affected by circumstances beyond their control.

Vol Abroad said...

Yeah, I know it says "may"...

And Nope. The pensioners have to pay just the same as everyone else. And ours isn't just a "property" tax - it's a residence tax (based on a categories of the value of your property) - so it falls even harder on the poor.

If you are really, really poor - that is on income support, you may apply for "council tax benefit" where you have a reduction of your council tax.

BUT this is based on income, not age.

I still don't know why rich old property-owning baby boomers should a great a break over everyone else - even if some poor, old people who had the great fortune to buy in an upwardly mobile neighbourhood benefit as well.

"John Galt" said...

BUT this is based on income, not age.

And this could be, too. All the change does is enable the tax freeze. It does not specify how it shall be applied or who will qualify.

And, you say the council tax is "based on categories of the value of your property". Exactly what do you think the property tax in Lawrencburg (for example) is based on?

Vol Abroad said...

Of course the property tax is based on the value of property - my point was that in the UK - it's a residence tax - doesn't matter whether you own or rent.

And do you really think that municipalities are going to put in a sliding scale income trigger? Nah, anyone who's old will get it.

"John Galt" said...

In fact, most assistance programs have income qualifications. Two that do not are Social Security and Medicare...though SS benefits are reduced if you continue to earn income after you start receiving payments.

St. Caffeine said...

Sorry, Vol, I've been out of town. I'm with you on this one. I think arbitrarily awarding tax breaks to the wealthiest age cohort in America is a "not smart" idea. If you want to help Grandma with her tax bill, then "means test" it. I'm sure the AARP would support that, right?

"John Galt" said...

Late news...

The state commissioner of elections (or some such title) as, discovered...that two important paragraphs have been omitted from the description of the amendment that has been loaded on all voting machines.

One of the omitted paragraphs requires the legislature to set a household income threshold above which you don't qualify for the freeze.