I think taxes will get passed to the renters in this case. I remember in econ 101 that for inelastic goods (such as housing) there’s a way to calculate how much of a tax will get passed to the consumer (i.e. Renter). The more inelastic the demand, the more the tax is paid by the consumer because they don’t really have a choice. Raising taxes would probably just drive rents up and possibly make more people homeless or forced to choose worse living options (e.g. Domestic violence would likely increase).
Maybe this approach is meant to avoid this problem. It probably creates other problems though. But better shouldn’t be the enemy of good. The problem needs to be solved because using real estate as investment vehicles is destroying the financial futures of young generations.
I think taxes will get passed to the renters in this case. I remember in econ 101 that for inelastic goods (such as housing) there’s a way to calculate how much of a tax will get passed to the consumer (i.e. Renter). The more inelastic the demand, the more the tax is paid by the consumer because they don’t really have a choice. Raising taxes would probably just drive rents up and possibly make more people homeless or forced to choose worse living options (e.g. Domestic violence would likely increase).
Maybe this approach is meant to avoid this problem. It probably creates other problems though. But better shouldn’t be the enemy of good. The problem needs to be solved because using real estate as investment vehicles is destroying the financial futures of young generations.