IPTI | Property Tax in the News – January 2026

IPTI’s usual monthly newsletter – the “President’s Message” – contains, inter alia, some summarised news articles from around the world. This IPTI publication – “Property Tax in the News” – contains some of the more interesting news articles concerning property taxes in North America and Europe which is where many of our members have a particular interest. Links to these and more, similarly summarised, articles – from North America, Europe and around the globe – can be found in “IPTI Xtracts” on our website: www.ipti.org. Please note that these are news articles; they do not necessarily reflect IPTI’s views.

USA

New York: Mamdani Calls the Property Tax System ‘Broken.’ He’s Right. Here’s How It Might Be Repaired.
Urban Matters: James, early in his inaugural address, Mayor Zohran Mamdani pledged to fix ‘a long broken property tax system.’ As a call to arms, that lacks the popular oomph of ‘Freeze the Rent’ or “Free Child Care’ – the issues he ran on. After all, two-thirds of New Yorkers are tenants. Most can’t imagine ever owning property here. So why did he give it such prominence? Why is it a big deal?

James Parrott: New York City will raise over $35 billion this year through the real property tax. It’s by far the single largest tax the City has, accounting for 43 percent of all tax collections. It’s alsovconsidered the third rail of New York City politics. Reforming it will create ‘winners’ and ‘losers,’ and even though the winners would likely outnumber the losers, many losers will lose big, because they have benefitted from the system’s inequities for so long. The system’s dysfunction is glaring, so if
you want to restore confidence in government, you have no choice but to take this on. I think one reason Mamdani has prioritized this issue is that he is intent on demonstrating that government can work more effectively and make things better for the average person if it doesn’t balk at taking on big problems.

UM: So, it seems you agree that our property tax system is broken. How and why is that true?

Parrott: The property tax system has been a mess for the past four decades, and in multiple ways.
It is fraught with inequities and the source of justifiably loud complaints from many residential owners who are over-paying compared to wealthier co-op, condo, and home owners in high-income Manhattan neighborhoods or brownstone Brooklyn.
The major problems are rooted in a 1981 State law passed at a time of great concern about stemming the flight of the city’s middle class to the suburbs. Among its complications, three stand out. The first is that one-, two-, and three-family homes have a low six percent assessment ratio relative to market value; other residential property types have a 45 percent assessment ratio. The second is that co-ops and condos are valued as if they were rental properties.

Together, these two features result in lower effective property taxes – taxes as a percent of comparable sales market value – for owner-occupied homes and apartments compared to rental apartment buildings.

The third and most reviled feature of the status quo is that the growth in assessments for one-, two, and three-family homes is capped at six percent a year, or a cumulative 20 percent over five years. That has resulted in extremely wide variation in effective property taxes on a neighborhood basis, with ones that have experienced the greatest sales price increases over the past four decades having the lowest effective tax rates. This means, for example, that many homes in brownstone Brooklyn have much lower effective tax rates than homes in many middle- and moderate-income neighborhoods, such as Bay Ridge or those on Staten Island.

UM: So, if we want property taxes to be fairer and simpler, where and how should we start?

Parrott: I was a member of an eight-person Advisory Commission on Property Tax Reform appointed by Mayor Bill de Blasio and Council Speaker Corey Johnson. We issued a final report at the end of 2021. We recommended stripping out features that led to structural inequities and providing relief mechanisms and protections to help ensure low- and moderate-income owners have affordable tax bills and that primary residents are not displaced from their neighborhoods.

Specifically, we recommended eliminating the assessment caps and equalizing taxation of resident owned properties, by assessing all one-, two-, and three-family homes, and also co-ops and condos, based on full market value rather than some fraction of market value.

A partial ‘homestead exemption’ would lower the tax burdens on properties that are primary residences of the owners. The homestead exemption would have a $500,000 annual eligibility income cap for the homeowners. We also proposed a ‘circuit breaker’ feature that would set a limit on property tax liability on owner-occupied homes for low- and moderate-income residents. The new tax structure would be phased in, to restrain tax increases for owners who’ve benefited from
the current assessment caps or the rental equivalence method of taxing co-ops and condos. Since the homestead exemption would exclude absentee owners of high-value ‘pied-a-terre’ properties, they would pay much higher effective taxes than they now do.

In short, we sought to address what we called ‘horizontal inequities’ by equalizing property tax
rates, while also – with the circuit breaker and partial homestead exemptions – promoting ‘vertical equity’ by lessening the regressivity of property taxes relative to income.

Let me add two other points that I imagine could be part of Mamdani’s property tax agenda.

The first relates to the fact that rental buildings generally pay higher effective property taxes than one-, two-, or three-family homes. Much of the resulting costs are then passed on to the tenants. So, an affordability agenda should address how to reduce that tax inequity and ensure that both tenants and truly struggling small landlords benefit – while also figuring out how to make up any revenues lost as a result.

Second, our commission noted that some very wealthy private institutions in the city, including big private universities and private hospital systems, benefit from the State Constitution’s ‘charitable institution’ tax exemption. It saves them an estimated $3.2 billion a year in property taxes. The Commission discussed the idea of a ‘public safety fee’ for all property owners that would help pay for the public services they receive; the fee would then be reduced by the amount of property taxes the owners pay.

UM: Final question: As a group, a lot of middle-class, outer borough homeowners didn’t vote for Mamdani for mayor. So, should talk about overhauling the property tax system worry them? Would their tax bills go up?

Parrott: Actually, in many of those outer borough neighborhoods most homeowners likely will come out ahead. And since we’re now talking politics, let me add this. I’ve always thought that property tax reform was such a third rail issue it could only be achieved in the second term of a term-limited mayor – someone not concerned with re-election. That is, until Mamdani came along. If he can succeed where his predecessors have failed, that will add to the reputation he hopes to establish that making government work is key to restoring faith in democracy.

James Parrott, a senior advisor and fellow at the Center for New York City Affairs at The New School, served on New York City’s Advisory Commission on Property Tax Reform.

Florida: Eliminating property taxes would make Florida’s ‘worst in the U.S.’ regressive system even worse

Florida’s state and local tax structure makes Florida an excellent place to be an affluent retiree or a wealthy investor, but not so great for working families or young couples starting out.

The Sunshine State has the most “regressive” tax structure of all 50 states, according to a recent study by a national tax analysis organization. That means the wealthy pay a lower percentage of their income in taxes while the poor and middle class pay more.

Proposals now being considered by Gov. Ron DeSantis and the state Legislature to sharply cut or eliminate property taxes on homesteads – owner-occupied homes – would likely make the tax structure even more regressive, according to tax experts.

That’s partly for the simple reason that property owners tend to have more money than non property owners.

While most states have regressive tax structures, Florida is the most regressive, according to the study from the Institute on Taxation and Economic Policy (ITEP), a non-profit based in Washington, D.C.

Low income

Florida families pay almost five times as large a percentage of their income as the wealthy in state and local taxes, the study says.

The lowest fifth of Floridians by family income pay 13.2 percent in taxes while the wealthiest 1 percent – those with incomes over $735,000 – pay just 2.7 percent, according to ITEP’s calculations.

As a whole the top 20 percent of income earners – those with incomes over $118,000 – pay 4.5 percent.

The main reasons are the state’s lack of an income tax and its heavy reliance on sales taxes, the ITEP figures show.

Sales taxes hit lower income families harder because they usually spend a greater proportion of their income on consumption than the wealthy.

And Florida depends heavily on sales and excise taxes, such as those on motor fuel, alcoholic beverages and tobacco. Unlike some states, Florida exempts groceries and medicines from sales taxes.

The Florida Policy Institute, a non-partisan policy analysis organization, has calculated that those taxes account for about 80 percent of Florida’s government revenue.

Both organizations are non-profit, non-partisan advocacy groups.

The Florida Policy Institute says its goal is to enhance economic mobility and quality of life; ITEP and its sister organization, Citizens for Tax Justice, are considered left of center and advocate for increased taxes on the wealthy.

In addition, a recent study by Realtor.com said eliminating property taxes on homesteads “would disproportionately benefit wealthy Floridians at the expense of those who don’t own homes.”

The study said the move could increase real estate prices in the state by 7-9 percent.

“It would be a boon to existing property owners,” says Realtor.com senior economist Joel Berner, who conducted the analysis. “But this measure would disproportionately benefit wealthy Floridians at the expense of those who don’t own homes, and would make it even harder to break into homeownership because of the increased prices.”

Kurt Wenner, senior researcher for Florida TaxWatch, a non-profit that advocates fiscal restraint and lower taxes, said it’s “not news” that Florida has a regressive tax system.

“Most state tax systems are,” he said. “Florida’s is more so because of this reliance on sales taxes instead of income taxes. Income taxes are usually fairly progressive.”

The Florida Constitution includes a prohibition on personal income tax and inheritance taxes, adopted in 1968.

“The lack of an income tax is also a major reason the state is so attractive to retirees,” according to the James Madison Institute in Tallahassee, and even suggesting repealing the constitutional prohibition has been a political third rail. There’s been no serious move to impose an income tax in recent years, possibly since the prohibition was enacted.

If eliminating taxes on homestead taxes led to greater dependence on sales taxes and other revenue sources, it would likely force the state and local tax burden even more heavily onto lowerincome people, said both Wenner and Neva Butkus, a senior analyst related to state policy at ITEP.

If homestead taxes are eliminated, “You’re going to have to come up with revenue somewhere,” Wenner said.

In its study, ITEP sought to include the effect of property taxes on rents, and the effect of corporate income taxes on the tax burden for all income groups, said Butkus.

It calculated that individuals in the bottom-20 percent income range pay 5.7 percent of their incomes for general sales and excise taxes.

That figure gradually decreases as income levels rise, down to 1.3 percent of income for the top 5 percent of earners, and 0.3 percent of income for the top 1 percent of earners.

Sales taxes are “deeply regressive,” said Butkus.

Homestead taxes usually are less regressive, Wenner said.

“There’s a general correlation between home value and income” – people with more expensive homes tend to have more income.

Hillsborough County Property Appraiser Bob Henriquez said property tax “probably creates the least inequity compared to other taxes. It’s based on your asset value and your asset value should be related to your ability to pay your share.”

However, the state’s Save Our Homes provision for exemptions from homestead taxes “goes in the other direction,” said Wenner.

It limits how much the taxable value of a homestead can go up to no more than 3 percent a year, regardless of how much the appraised value increases, and therefore limits the amount of tax levied.

That means the value of the tax break provided increases year by year, and long-term homeowners pay much less than newcomers and first-time homebuyers on comparable properties, as the Florida Trident previously reported.

The Save Our Homes tax break doesn’t apply to rental homes, so renters feel the burden in higher rents.

Asked what kind of property tax break would lessen the tax burden on lower-income people, Butkus suggested a “circuit breaker” approach adopted in several states – a tax break linked to income levels rather than length of ownership.

“That approach does what many legislators say they want to do, which is lower the burden for working families,” she said.

CANADA

British Columbia: Assessments – Lower Mainland real estate values fall as northern B.C. values rise

The latest B.C. Assessment Authority figures show a Surrey detached home fell in value by on average six per cent, while a detached home in Prince George rose in value by three per cent

Real estate values in the Lower Mainland have fallen, while the price of a detached home in the North has generally risen, according to latest information from the B.C. Assessment Authority.

“Many homeowners throughout the Lower Mainland can expect some decreases in assessed value, with most changes ranging between minus 10 per cent and zero per cent,” said B.C. Assessment assessor Bryan Murao.

“The softening housing market is being reflected in 2026 property assessments.”

Overall, the value of all Lower Mainland properties fell to $1.92 trillion on July 1, 2025 from $2.01 trillion on July 1, 2024. This means the total value of all properties in B.C. fell by $90 billion. However, the 2025 figure includes $24 billion worth of new builds and subdivisions. The value of properties that existed in 2024 was $114 billion greater than the same properties on July 1, 2025.

The Lower Mainland comprises greater Vancouver, the Fraser Valley, the Sea to Sky area and the Sunshine Coast.

In that region, for a detached home, the biggest drop between July 1, 2024, and July 1, 2025, was nine per cent in White Rock, to an average $1.58 million.

Detached homes in the small and expensive University Endowment Lands enclave, the City of Langley and Richmond all dropped eight per cent on average.

Surrey detached homes fell by six per cent to an average of $1.464 million, while in Vancouver, the drop was five per cent to an average of $2.092 million. Whistler and Hope reported no change, but Squamish was an outlier, reporting a two per cent jump.

For Lower Mainland condos, Surrey had an average drop of seven per cent, with six per cent drops in Richmond and White Rock. Vancouver condos fell on average three per cent to $772,000.

Greater Vancouver Realtors MLS monthly housing reports show the composite benchmark price for Metro Vancouver properties has cumulatively dropped 3.2 per cent since the latest assessment figures were calculated.

Murao said the value of a detached home in the North Central region, which includes 70 per cent of the province by land mass, rose as high as 15 per cent in some communities. “The North Central real estate market remains stable, which is being reflected in the 2026 property assessments,” he said. “Most homeowners can generally expect value changes in the range of minus five per cent to plus 15 per cent, with some exceptions depending on the community.”

The average value of a detached home in Fort St. James rose 14 per cent to $244,000, while in Hazelton, values rose 10 per cent. Prince George had gains of two per cent for a detached home, to $459,000, while Prince Rupert had gains of three per cent.

Vancouver Island and the Southern Interior had changes ranging between minus five per cent and plus five per cent.

On Vancouver Island, the value of a detached home in Victoria rose by one per cent, while Central Island locations such as Ladysmith, Lake Cowichan, Duncan and Parksville all had modest increases of between two and four per cent.

In the Southern Interior, owners of detached homes in the Columbia region had some gains, including six per cent in Fernie and Kimberley, and nine per cent in Sparwood. Owners of detached homes in Nelson saw on average an increase of three per cent. There was no change in Castlegar.

Murao noted a 30 per cent increase in assessed values of homes in fire-ravaged Lytton.

“Lytton remains an exception as that community continues to rapidly add value through its recovery and rebuilding efforts,” he said.

Real estate commentator and realtor Steve Saretsky said the difference in valuation changes between the Lower Mainland and northern B.C. was likely due to a lag effect.

“The city is always the first to move, either up or down, and the outlying areas will follow,” he said.

Saretsky said that, anecdotally, the condo market in downtown Vancouver has dropped 10 per cent over the past year. He said properties in the traditionally more expensive westside area of Vancouver are also down 10 per cent.

The Remax Greater Vancouver Housing Market Outlook for 2026 predicts house prices will continue to fall this year, noting “real estate investors are almost non-existent in Vancouver right now.”

This indicates that the provincial government’s Bill 44 – which overrides municipal powers to allow high-density development on single-family lots – did not lead to increased lot values or great interest from developers.

The Remax report states the market has shifted to the point where potential buyers are able to secure accepted offers subject to the sale of their existing home. Traditionally in Vancouver, the buyer with the fewest conditions usually wins. “In general, market conditions in 2026 are anticipated to follow trends similar to those seen in 2025,” the report states.

The B.C. Real Estate Association is predicting “limited price growth” in 2026. Saretsky said that B.C. is in the fourth year of a real estate downturn and that corrections usually last five years.

The latest property assessment details can be accessed at bcassessment.ca, using B.C. Assessment’s assessment search online service.

EUROPE

UK: 2026 business rates revaluation could ‘cripple’ UK manufacturing

Tadweld, a leading UK steel fabrication and engineering company, has warned that the 2026 business rates revaluation will “cripple” UK manufacturing and force small firms to the brink.

The company’s Managing Director, Chris Houston, claims that the April 2026 revaluation will deliver another crushing blow to industrial businesses already under severe cost pressure, pushing many smaller firms towards downsizing or outright closure just months after it comes into force.

The 2026 Business Rates Revaluation in England and Wales takes effect on 1 April 1, with new rateable values based on commercial rental values as of 1 April 2024. The revaluation is designed to update business rates to reflect market conditions since the last revaluation on 1 April 2021. However, Tadweld claim the timing and scale of the increases could not be worse for manufacturing businesses already facing unprecedented cost pressures.

Under the new system, England will introduce five tiered multipliers, replacing the previous tworate structure, while Wales will continue with its own framework. Although some reliefs may be available for certain retail, hospitality and leisure (RHL) sectors, industrial and manufacturing premises are expected to be among the hardest hit. Businesses are being urged to check their new rateable values on GOV.UK and consider appeals before the 31 March 2026 deadline for challenging current valuations.

Chris said the revaluation represents yet another policy decision that disproportionately harms manufacturers: “Historically, business rates were revaluated every five years – in reality, closer to every 5.5 years since 1990. The government has now moved to a three-year cycle, meaning businesses were hit with increases in 2023 and are now facing further increases again in April 2026. This is relentless.”

Industry data suggests the average increase in rateable values is 19.3%, with retail at 9.3%, but industrial and warehousing businesses facing average increases of between 21% and 28%.

“Manufacturing and warehousing are being hammered the hardest. These are exactly the sectors the UK relies on for productivity, exports and skilled jobs – yet they’re being treated as an easy target.”

Tadweld argues the revaluation lands at a time when businesses are already reeling from a series of government-imposed cost increases:
• Corporation tax increased from 19% to 25% in 2024
• Major rises in Employer National Insurance contributions in 2025
• A National Minimum Wage increase of 11.1% between April 2024 and April 2026

“Despite claims of being pro-business and pro-growth, this revaluation couldn’t have come at a worse time,” Chris added. “It’s a triple-punch to employers who are already struggling to balance the books.”

Small manufacturers at risk of closure

Tadweld, which is an SME steel fabrication business operating across the UK, employs 50 people from its local community.

Chris warns that for many firms of similar size, the impact could be existential: “We employ 50 people from our local community, and at a point where businesses are feeling attacked on all sides by government policy, this is yet another cost increase that has to be found from somewhere. These cost increases mean less money to invest, less money for staff, and ultimately they hamper our ability to grow and create jobs.”

He added that smaller manufacturers, already operating on tight margins, may have no room left to absorb further increases: “For many small manufacturers, this will be the tipping point. You can only absorb so much before investment stops, recruitment freezes, or sites simply close. Once manufacturing capacity is lost, it doesn’t come back easily.”

Business confidence at record lows

Chris also pointed to growing evidence that business confidence is collapsing under the weight of repeated policy shocks: “Unfortunately, businesses have become the ‘sacrificial lamb’, expected to fill the black hole in public finances. The Institute of Directors is now reporting record-low business confidence – lower even than during the depths of the COVID pandemic. That should be ringing alarm bells in Westminster.”

A call for urgent government action

Tadweld is calling on the government to rethink how business rates impact productive industries and to offer meaningful relief for manufacturers ahead of April 2026.

“If the government genuinely wants businesses to grow, invest and improve productivity, it urgently needs to start supporting them rather than continuously handcuffing them. Without change, this revaluation risks doing long-term damage to UK manufacturing that will be felt for years to come.”

Compliments of the International Property Institute – a member of the EACCNY