Explain Like I'm Five

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Explain Like I am a child ... taxes. I get you pay taxes on goods you buy everyday. And you get said goods by paying a one time fee. But how come on a home after being paid off I still pay taxes...... (lemmy.world)

submitted 3 weeks ago* (last edited 3 weeks ago) by Patnou@lemmy.world to c/explainlikeimfive@lemmy.world

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I mean I paid for it like I would anything else I wanted. They charge a tax at checkout. So if I buy a house and pay the whole thing off, why do I still have to pay taxes on said house when I paid the whole agreed on price in full? It would be like me buying a six pack of beer I pay for it and tax at checkout. But then timely I have to keep paying taxes on the beer even though paid in full?

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[–] School_Lunch@lemmy.world 9 points 3 weeks ago

The choice is between sales tax or property tax. Different counties and states can have different policies regarding that. What it comes down to is who should be paying more in taxes given the overall amount collected stays the same. If you put more emphasis on sales tax, then more of the tax burden is put on people with less wealth who don't own properties. If you put more emphasis on property tax, then more of the tax burden is on wealthier people who do own properties. So the question is who should have a bigger tax burden, rich or poor?