“Real-estate tax on either commercial or residential properties is essentially a regressive tax.”
That’s not right.
The following taxes are regressive:
Sales tax
Auto registration fees
Excise taxes (on alcohol, gas, tobacco)
Flat state fees (for driver licenses etc)
Flat “per property” assessments for special districts
The following taxes are mildly progressive:
Income
Residential property
The following taxes are very progressive:
Commercial property
Capital gains
Inheritance
Taxes on 2nd residential properties.
Businesses can only pass on increases in their “marginal” taxes. Commercial property taxes are not marginal. At worst, it will discourage investment in commercial property. Offsetting this, however, is that commercial property will become cheaper, facilitating new investments. People sitting on vacant commercial property that is taxed at 1% of a 1975 assessment may also decide to develop it rather than waiting around forever.
