Dynamic Property Taxes and Racial Gentrification
Virginia Public Law and Legal Theory Research Paper No. 2020-80
24 Pages Posted: 23 Dec 2020
Date Written: December 18, 2020
Many jurisdictions determine real property taxes based on a combination of current market values and the recent history of market values, introducing a dynamic aspect to property taxes. By design, homes in rapidly appreciating neighborhoods enjoy lower tax rates than homes in other areas. Since growth in home prices is correlated with – and may be caused by – changing neighborhood demographics, dynamic property taxes will generally have racially disparate impacts. These impacts may explain why minority-owned homes tend to be taxed at higher rates. Moreover, the dynamic features of local property taxes may subsidize gentrification and racially discriminatory preferences.
Keywords: property tax, race
Suggested Citation: Suggested Citation