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Comment by scarface74 | Hacker News Reader

So if we want to tax illiquid assets and wealth instead of income, why stop at houses? Why not tax equity held in companies? Why don’t we tax employees based on the amount and value of equity they have in a company? Every time there is a new round of funding that increases the value of equity, impose a higher tax.

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It's not really houses that are important to tax, it's land, because there's a fixed amount of it, especially valuable land, so it's useful to encourage economically efficient use of that land. No property or land tax means people can just sit on land forever if they feel like it with no real downside, besides missing out on potential revenue.

This is bad for society, because people need land for things, and unlike cars or computers or gold we can't just ship it in from elsewhere if some provider is being obstinate.

No you can’t just “ship land” elsewhere. But, there is nothing stopping people and companies from moving where land is cheaper. The land is only valuable because people want to live in California instead of places where it cheaper.

Its not just the supplier who is being “obstinate” the consumer is also refusing to look other places.

You have to remember that companies compete with others for human labor. If your company moves to a city nobody wants to move to, you'll lose labor resources to another company (in the case of SF companies, highly skilled labor that's not easily replaceable and has high training costs).

While I also think companies should spread out more, the very fact that so many companies are paying the significantly inflated property and labor prices in the SF area shows the tremendous economic value in having access to that labor market.

Do you really think that companies like Amazon, Google and Apple couldn’t move to any major metro area and convince enough people to move there if they paid them enough where they could offer potential employees enough to live well, pay then less and benefit from a much lower cost of living?

Anecdotally, I would never move from where I live - Atlanta - to the west coast. There is nothing appealing about the area or the cost of living vs salary. I’m not saying I wouldn’t move to another major metro area if the jobs somehow dried up here.

That limits my salary (not really the COL vs salary is very attractive to me here) except I’ve seen a few local jobs for MS pop up here and jobs at Amazon (AWS) for Solutions Architects, Professional Services, etc. that I may be interested in in a couple of years.

I could also argue that a lot of companies that think they need to hire “rockstar ninja developers” to write their yet another software as a service CRUD app are mistaken and if they had to actually worry about silly things like profits instead of being subsidized by venture capital they could find a way to either relocate to a cheaper area or allow more remote work.

The value of land, and the things that are on it, are tied together tightly. For much of California the price homes has much of the value in the home.

Even worse the assessed value of property, for tax reasons and insurance reasons can be abnormally low in CA (vs value). Many people in the fires have learned too late that they were underinsured and are no where close to being able to rebuild the same house on their property with their insurance payouts.

No one else here is arguing about the merits of a property tax. The issue is that people are paying wildly different tax amounts for the same asset. This is exactly the same issue we see in industries where the entrenched companies put up huge barriers for newcomers.

It is because of the unintended consequences if companies decide to relocate. You start with wanting to tax wealth and then suddenly you find your area in an unemployment crisis because the employers packed up and left.

Property taxes are taxing wealth - just a type of wealth that doesn’t affect the people who want more affordable housing.

If (metaphorical) you want to raise property taxes to force people to move to make housing more affordable, why go through the circuitous route? Why not just use imminent domain, take the land, bulldoze the house and put up apartments?

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