Penjihad's Blog

"To comfort the afflicted and afflict the comfortable"

Taxes in Washington State; Ethnic Cleansing or Gentrification?

Oh, happy day! Real estate property prices are stratospheric. Much money is being made by investors, real estate brokers and the mortgage industry. Cities and states are flush with the taxes from increased sales and increased values, how can we not be happy? 

Amid the shouts of joy and the popping of champagne corks, the moans of the people at the other end of this celebration go unheard, their tears, unnoticed. These are the people who bought their modest homes decades ago with the intention of living out their lives in their homes. That was not to be, because they are now forced to sell their homes and move to distant homes while their homes make way for mansions. 

Several years ago, I was a real estate broker helping a client sell their home in a Seattle’s predominantly Black district. I was standing outside when I met an older Black gentleman and we chatted for a brief while. He told me he lived “down the hill”, he bought his home decades ago for just a few hundred dollars. Now, he continued, he does not know what to do because his property taxes are more than the money he makes. “I have to think about moving South but even there, the prices are high, where do I go?” 

Sanitized ethnic cleansing. Blacks and other minorities are being taxed and priced out of Seattle, the Eastside and the suburbs. Our leaders put a gloss on this by calling it “gentrification”, but that should not hide the stark, cruel, reality. We cannot promote low-income housing on one hand and force low-income people out of their homes on the other. 

Washington taxes properties at their current market values. This may seem equitable, but it penalizes those who have lived many years in homes they could originally afford but are unaffordable today. A two-bedroom house in Northgate cost about $50,000-$65,000 in the mid-1980s. Taxes for the home at the time, were about $600 per year. Today, the same house will sell for about a million dollars and the new owners’ taxes will be between $8,000 and $10,000 per year. 

Washington state depends on property taxes for its operations, there are no income taxes. The problem with such a tax system is that poor people get taxed in much higher proportions than the rich. Even when they are just renting their homes, they are paying the landlord’s high taxes. Income taxes have become stigmatized as “Communism”, a catchword that galvanizes the ignorant. This is because today’s politics do not allow for the voices of the poor; politicians only listen to those who can pay the money for the next election. Thus, there is little incentive to change from a property tax state to an income tax one. 

Ideally, Washington state should move to an income tax system where people will pay their proportions of taxes rather than be driven out of their homes by an inequitable taxation system. If the state cannot move to an income tax base and needs to keep both income and property taxes on the table, then people should be charged taxes on the value of the property when they purchased it or, when they last refinanced it. To start with, all people who bought or, re-financed their homes more and ten years ago must have their property taxes frozen from that time. For the more recent transactions and continuing on, taxes should be based on the price paid or re-financed at the time and kept at that point until re-financed, sold or transferred again. 

We cannot be a multi-cultural, diverse region if we continue to force out the poorer minorities, not even by calling it “gentrification”. 

Jeff Siddiqui is a real estate broker and a civil rights activist. He is a long-term resident of Puget Sound area. His articles have been published in the Seattle Times and other magazines, he has been a guest on local radio and TV talk-shows.

July 13, 2021 - Posted by | Uncategorized | ,

1 Comment »

  1. @Jeff, Good opinion \

    Like

    Comment by amit shah | July 14, 2021 | Reply


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