Opposition forming to proposed tax hike on home sales

sold.jpgThe measure wouldn't go to voters until at least next March, but already you're hearing gripes - mainly from L.A. real estate groups that worry about the effect on home sales. It is a pretty hefty jump: On a $500,000 sale, reports the Business Journal, the tax would go from $2,250 to $4,500. If someone really wants to do the deal, another two grand might not be fatal. But the complaints are understandable. Faced with serious shortfalls going out the next several years, the city might be better off spreading the pain. (The transfer tax would be more than 16 times higher than most other cities in L.A.) Unfortunately, there aren't that many ways for a city to raise big chunks of revenue. Another part of the plan involves an increase in parking lot taxes. From the Business Journal:

[L.A. budget chief Miguel] Santana said that when real estate groups emphasize the proposal's negative impacts, they forget to include the other side of the equation: a continual drop in services as the city grapples with a long-term structural budget deficit. "Without additional revenue, there will be less money to spend on reducing police and fire response times, fixing our streets and sidewalks, and other services crucial to the quality of life," he said. "Over time, our lack of ability to address these basic concerns could also lower property values."

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Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.
Mark Lacter, business writer and editor was 59
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