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> people often do not have sufficient liquid holdings to pay the taxes.

This is the "death tax" argument and has been debunked over and over. When they tried to find one of those, as the story goes, "farmers who lost their family farm", they couldn't actually find one.

If this is a genuine concern, then personal holdings of property should have capped tax increases until they transact. At point of transaction (inheritance generally), the assessment jumps to match the market.

As for corporate holding of property, it should get no such consideration. If you can't pay the tax, you transact the property. California is having a massive problem with the fact that a bunch of really expensive real estate in places like Silicon Valley have subleases that are 20+ layers deep to avoid triggering a reassessment.

That isn't true. Great article about the death tax here[1]. Also, have a look at these famous auctions[2]. Some were brought on by things other than taxes but death duties that Labour increased in the 1940s were definitely a precipitant. But these taxes are far reaching. From [1] it even says the death duties earn less than booze or tobacco, or vehicle duties.

I can't speak to corporate holdings of property, I am specifically talking about property held for generations in families. My general points are that it is a)inefficient and strange to target certain people that inherited and b) when you do target them, there are unintended consequences.

[1]http://www.telegraph.co.uk/news/politics/georgeosborne/11907... [2]https://en.wikipedia.org/wiki/British_country_house_contents...

As your article mentions, the problem is that the rich have a loophole because the property isn't taxed properly when transacted.

The point isn't to make "inheritance" the taxation point, it's to make "transaction" the taxation point.

In addition, I think that "inheritance tax" executes differently in the US than the UK.

I wasn't quite sure what you meant originally but I see it now and completely agree with taxes on transactions and perhaps removing those loopholes.

I fail to see why, if they aren't using the land productively, they shouldn't sell to someone who will. I don't understand why I should feel bad for the family whose small plot of land becomes very valuable so they make lots of money. How terrible!

So exempt primary residences from large tax hikes. The original promise of Prop 13 was to protect grandma from having to sell her home due to rising property values. But there have been some pretty bad side effects and a lot of the benefits are going to the commercial property owners and wealthy individuals and landlords.

But the original promise actually to protect people with larger property holdings like apartment complexes and condominium complexes.

This could have been solved by square footage or price floors. If grandma lives in a mansion, maybe she should be paying her share :)

The only thing worse than a wealthy person sitting on a vast horde of cash is a land-rich person sitting on vast tracts of highly desirable land. If somebody owned several acres in the heart of Manhattan and chose to leave them in the form of undeveloped, fallow fields, why should we not charge them high taxes in order to force them to either develop the land or sell it off to somebody who will?

Land is one of the rare cases where the needs of the many trump the rights of the few.

So what if we apply that rule to poor and middle income people? Are you suddenly interested in taxing those people to get them out so that someone with more cash can do something better with their land? What about people with just enough land to have an unsustainable tax rate but not enough land for it to be immediately useful for development? People with older homes in cities fall into this category frequently. How much revenue is this worth for the government after land is sold and properties destroyed to make way for new versus if they had just raised tax on income? This assumes there is even a willing buyer.

>People with older homes in cities fall into this category frequently.

Would this not be a good example of just the sort of thing that would be fixed by this tax?

There are many people in places like San Francisco and Manhattan that are holding on to single family homes. This reduces the amount of housing that is available and increases rents. It seems fairly reasonable that these people should pay for the enormous resource usage.

I don't see how a tax resolves that situation, if the situation indeed needs resolving. The tax could just as well cause a large apartment with many renters to be unsustainable and become replaced with a smaller apartment with very high rents to cover the cost. If land can be used to build an apartment, that is one issue, but another issue is using a tax policy to try to change its ownership or purpose. I am more strongly opposed to the latter.

Raising tax on income is regressive by its very nature. The wealthiest people in our society pay almost no income tax at all and raising it would not affect them.

If an old couple is barely scraping by on a pension but sitting on a property worth millions that could be converted to an apartment housing hundreds of people, why shouldn't they be encouraged to sell or at the very least rent? In their present state they are a net drain on society, paying no income taxes and squeezing everybody else into less available land.

Land value taxes[0] are the answer to this mess.

[0] http://www.economist.com/blogs/freeexchange/2015/04/land-val...

If every person has the right to defend even by force — his person, his liberty, and his property, then it follows that a group of men have the right to organize and support a common force to protect these rights constantly. Thus the principle of collective right — its reason for existing, its lawfulness — is based on individual right. And the common force that protects this collective right cannot logically have any other purpose or any other mission than that for which it acts as a substitute. Thus, since an individual cannot lawfully use force against the person, liberty, or property of another individual, then the common force — for the same reason — cannot lawfully be used to destroy the person, liberty, or property of individuals or groups.

Such a perversion of force would be, in both cases, contrary to our premise. Force has been given to us to defend our own individual rights. Who will dare to say that force has been given to us to destroy the equal rights of our brothers? Since no individual acting separately can lawfully use force to destroy the rights of others, does it not logically follow that the same principle also applies to the common force that is nothing more than the organized combination of the individual forces?[1]

[1]: http://bastiat.org/en/the_law.html#SECTION_G008

The right to defend one's person is not strictly a defensive right - without food, water, and shelter a person's body will get sick and die. Therefore, defense of the body carries the possibility of necessity for aggression, particularly against the property of others.

In view of this, the idea of placing one's property rights on the same level as the rights of the person of another is flawed. If one person is starving and another owns far more food than he could eat in a lifetime yet refuses to part with it I see no problem with the starving man using force to obtain his daily bread.