I don’t know many people who are enthusiastic about paying taxes. I’ve lived in both in California and New Jersey, so I am well acquainted with being overtaxed. For good reasons, there is a growing property tax revolt across the nation. Here in Wyoming, significant property tax cuts were adopted by the legislature last session, and more are being proposed for the 2026 Budget Session.
Can a Case be made for the Property Tax?
Even while acknowledging legitimate public discontent, the Tax Foundation published a policy paper in late 2024 that argues that the property tax is economically efficient, comparatively less distortive than many other taxes, and therefore worth preserving – provided proper reforms are adopted. The paper argues that property taxes have several advantages:
- They impose fewer economic distortions than many other taxes (because the tax base – land plus improvements – is relatively immobile
- They align reasonably well with local benefits received by property owners (e.g., local services, infrastructure)
- They are transparent and tie into local preferences for services/taxes, which promotes accountability
This said, the paper does not claim the property tax is perfect: it highlights that runaway increases in property values can lead to tax burdens that many homeowners simply cannot handle.
The Problem: Rapid Growth in Tax Burdens
Because property values have surged, in many jurisdictions the effective tax burden has jumped – even if the nominal tax rate (millage) did not increase. Indeed, many complaints center, not on tax rate increases, but on tax bills rising due to increased values, creating issues of fairness, housing affordability, and political pressure for change.
Common Reform Options and Their Trade-Offs
The paper goes on to review a number of policy options for relief and reform, discussing both pros and cons, options that I’ll be sharing in upcoming newsletters.
The legislature is considering adopting additional property tax cuts. However, with our counties struggling mightily to maintain infrastructure and fund basic services, perhaps we should look into fixing, rather then eliminating, the property tax.
