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Why Removing the Tenant Tax is Important

When Mayor Taveras vetoed an extremely modest proposal to lower the tenant tax, he framed the issue in a variety of ways which were intellectually dishonest (the mayor's veto may be overrided by City Council, so let your Councilperson know what you think about this issue).

Here's what the mayor had to say:

And I cannot in good conscience consent to an ordinance that reduces taxes for landlords who may not live in Providence on the back of homeowners who live in our city.

The mayor's position is dishonest because he understands that the landlords may or may not live in the city, but that certainly their tenants do. The political calculus has nothing to do with whether it's truly fair to have this tax structure, or whether it's good for the city, and everything to do with the calculus of who votes and who doesn't. Tenants, who are more likely to be from disempowered groups, are expected to be a less active voting block. He's framing an issue as if he's defending the powerless, but in reality he's doing the opposite.

He's also doing the classic Rhode Island thing, which is to act like anything not Rhode Island is suspect. Whether the landlord lives here or not really isn't relevant. They should pay more taxes if their building is worth more, not because they live in another city or state.

The proposal would have lowered the tenant tax, but the tenant tax should be eliminated entirely. It's wrong for the city to tax rented and owned buildings differently. It should instead tax buildings on the same basis across the board--a percentage based on the value of the building. An even more far-reaching measure would be to institute some kind of a land tax.

One proposal we've floated is to lower the tenant tax to 100% of the homeowner property tax, and tax parking to make the difference up. This would resolve the problem of renters taking on the burden of taxes to grant an unfair advantage to homeowners, and would also have the benefit of providing good land use incentives. It would also encourage infill of useful buildings, instead of parking, which would help grow our tax base. And it would obviously have huge environmental benefits.

Taveras' position is unacceptable, and tenants should get organized and demand change.


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