An Age-Based Delayed Housing Wealth Tax

Abstract

Abstract Popular narratives around intergenerational inequality suggest that young people are subsidizing older people in spite of enjoying poorer economic prospects. One more specific concern is that older and younger birth cohorts are unequally situated with respect to the distribution of housing wealth as well as the distribution of the tax burden. This chapter develops and defends a proposal for a delayed housing wealth tax. Once homeowners reach a certain age, they are charged some portion of their home’s value, on an annual basis, which will eventually be paid to the tax office upon the death of the surviving spouse. The delayed housing wealth tax compares favourably with alternatives such as inheritance taxation.