Fiscal Zoning and Economists' Views of the Property Tax
William A. Fischel
Dartmouth College - Department of Economics; Lincoln Institute of Land Policy
June 19, 2013
Fiscal zoning is the practice of using local land-use regulation to preserve and possibly enhance the local property tax base. Economists agree that if localities can conduct "perfect zoning," which effectively makes all real estate development decisions subject to a review that balances its benefits and costs to the community, then the local property tax can be converted into a benefit tax and lacks the deadweight loss of taxation. This essay argues that American zoning is closer to this ideal than many other economists think. The practice is often difficult to detect because zoning serves several objectives besides fiscal prudence.
Number of Pages in PDF File: 25
Keywords: fiscal zoning, property tax, benefit taxation, deadweight loss
JEL Classification: H7
Date posted: June 20, 2013
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