Bricks, Taxes and Spending
Solutions for Housing Equity across Levels of Government
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This report addresses housing inequities through a series of analytical chapters and case studies. The cross-country chapters examine the effects of the COVID-19 pandemic on housing demand, develop a proposal for a green land value tax, evaluate the dynamics between fiscal autonomy and housing supply responsiveness, as well as explore the drivers of inter-regional migration. The case studies unravel the changes of Korea's progressive national property tax and a programme to address regional imbalances, assess the impact of the US property tax system on housing, dive into Norway's property taxation in relation to inequality, as well as survey Belgium's approaches to housing policy. With a blend of empirical data and critical analysis, the report underscores the pressing need for comprehensive strategies in addressing housing inequities. It also offers insights for policymakers and scholars, highlighting the complex balance between national and local housing policies.
Inequality, property taxation and local public spending on housing
In most Western countries, income and wealth inequality have increased during the last decades. We study the impact of increased inequality on property tax receipts and housing outlays by Norwegian local governments. In Norway, both income inequality and housing wealth inequality have increased between 2010 and 2017. Our main findings are: (i) increased income inequality does not affect property tax receipts, nor local public spending on housing, (ii) housing wealth inequality increases the level of the property tax and (iii) housing wealth inequality increases housing-related spending. Interestingly, the two types of inequality have different effects. Compared to earlier studies, which find that income inequality increases property tax receipts, we only find an effect of housing wealth inequality. Surprisingly, we also find that neither income nor housing wealth inequality has any impact on the distributional effects of the property tax measured by the size of the basic deduction.
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