National Tax Journal · 1974 · 42 citations · 9 references
BusinessPublic FinanceReal EstateProperty TaxationReal Estate EconomicsTaxationCapitalization RatesIncome Capitalization ApproachProperty TaxProperty Value ImpactsResidential Property TaxationTax CapitalizationAssessment Of Residential PropertyCapitalization Of Property TaxesCapitalization Rate EstimationEstate Tax RatesProperty Tax CapitalizationProperty Tax Rate DeterminationProperty Tax RatesReal Estate Tax Capitalization
A model of tax capitalization is estimated and tested using single family residential sales data. The efective property tax rate due to variations in assessment error has a significant effect on market price; in fact, it appears that current tax rates may be overcapitalized. These findings suggest that proposals regarding modification of property tax rates, administrative procedures, and institutions may have a significant impact on single family residential property values. Furthermore if nominal tax rates are varied, a significant wealth effect will most likely occur.
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