‘Taylor Swift Tax’ on the Croats for a larger rejects the sponsors of the broader

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The new pushing by the state of taxes in the real estate of the rich induced returnees among intermediaries and potential customers, who say that taxes punish the most important local spending.

Of the tax directions within the roots within the Royal Island and Montana to the proposed CAP transfer tax on the homes of La Mansion, the state and local governments see the gold mine in expensive in expensive properties of the rich.

“It’s a blow to the face of people who just spend money here,” said Donna Krueger-Simmons, sales agent from Modt & Chace Sothebi’s international in head Hill, Rhode Island.

Tax hikers are driven by side public budgets and a populist anger over housing costs. States are required to cut off budget cutting is expected from new subject and spending in Washington. At the same time, the housing market became the opportunity of two customers, and middle classes and younger families who fight homes while the luxurious housing market succeeds with wealthy all purchasing customers.

A solution for many countries: tax taxes of rich houses.

New Left Rhode Island, the nickname is “Taylor Swift Tax” is among the most extreme. Popstar bought a house on the beach in the State Community Elite Watch Hill 2013. Years.

The measure imposes a new surcharge on other homes worth more than a million dollars. For undue residences or those who are not busy for more than 182 days a year, the state will charge $ 2.50 for every $ 500 in the estimated value above the first million dollars. This charge is at the top of existing property taxes and will be added to major increases for luxury homes in Newport, watching the hill and other well-fifths, summer communities in the state.

For example, Swift House is estimated at about $ 28 million, according to local real estate records. Its current property taxes are estimated about 201,000 dollars a year. New charges will add another 136,442 dollars to its annual taxes, bringing it annually to H23,442 – Although the local population is rarely visited.

Real estate brokers say the increase in the goal is on very taxpayers who already contribute. The rich second household owners pay huge property taxes, but do not use many local services, because their basic residences are in New York; Boston; Palm Beach, Florida; or other shop. Their children usually do not attend local schools, and they are rare users of the police, fire, water and other municipal services because most stay only 10 to 12 weeks from year.

“These are people who are just coming here in the summer, they spend their money and pay their fair share of taxes,” Krueger-Simmons said. “They only punish themselves because they also live somewhere else.”

Brokers and many years of residents say the summer residents of Newport, watch the hill and other seasonal cities on the beaches of economic engines for local companies, restaurants and hotels.

“Just hurt people who support a small job,” Lori Joyal said, Compass Office Lila Delman in the Beat on the hill. “You haunt people who spend most of the money in these cities.”

Rhode Island also mountaineers of their tax on the transport of luxury real estate starting from October. Real estate sales tax will be an additional $ 3.75 for every $ 500, which paid above $ 800,000 to buy real estate. At the same time, the state tax on the Strmit estate is characterized by many of Ultrahum, of life there full-time.

Brokers say some other home owners consider sales and many would be pausing their purchases. Although only taxes are not expected to lead to a significant flight of wealth, Joyal said that potential buyers in Rhode Iceland are already watching coastal towns in Connecticut as alternatives.

“It’s always about the election,” she said. “At the end of the day, it is how they can decide to implement their discretion dollars. Connecticut has several beautiful coastal cities without some of these other taxes.”

Montana has passed a similar tax. The inflow of California and other wealthy newcomers who poured into the state during the conscents led to the price of house and growing indignation due to gentrification. Meanwhile, a low tax income tax rate and a lack of sales tax has left a small room to increase revenues to manage the necessary increase in services.

In May, the state has passed a two-stage tax plan, lowering rates for residents full-time and tax raising other homes and short-term rentals. For primary residences and long-term values ​​of values ​​at or below the middle price of the state, the tax rate will be 0.76%. Homes more valuable will be faced with a close installment system to 1.9% on any value as a whole of four times from medium price.

The Montana Ministry of Revenue expects changes, which will start next year, will increase taxes on another home reach on average 68%. Brokers say some customers wait for tax bills to see next year before making any decisions about whether to buy or sell.

“I heard about some customers who put the brakes to wait for the dust to settle and see what was happening,” Valerie Johnson said, with Purevest Christie International real estate in Bozeman, Montana.

Johnson said that while legislators were to guess the wealthy owners of another home, will also hit long-term locals who possess investment and rent them for income.

“These are small businesses for many people,” she said.

Manish Bhatt, a senior policy analyst at the Tax Foundation, said that tax conditions for rich second-domestic owners could be popular, but rarely give successful or efficient tax policy. Reform taxes on real estate should be wide, and not focused on taxpayers who allocated only because they do not live in a full-time community, he said.

“Currently, it catches you find revenues,” he said. “But the taxation of another home owners could have the opposite impact – distracting people to possess another home or teaching in these communities.”

Although the new tax cannot be drawn by rich, “we know that taxes are important for companies and individuals and that they can make a decision to make a decision to buy in the second proximity,” Bhatt said.

Projected revenues from new taxes can also be disappointed. When Los Angeles went through his so-called “tax on summer” in 2022. years, the proponents have changed $ 600 million revenue to $ 1.1 billion a year. The tax, imposed by selling real estate over 5 million dollars, built only 785 million dollars after more than two years, according to the housing department Los Angeles.

Larger interest rates that hurt the housing market played a role, experts say. However, Michael Manville, Professor of Urban Planning in the UCLA Luskinska School for Public Affairs, said that rich customers and sellers also reduced transactions in response to tax.

“Lower income is a reason to take care because this indicates that taxes could reduce transactions, which in turn can reduce the housing product and property tax revenue,” he said.