FUTURE DIRECTIONS FOR BUSINESS PROPERTY TAXATION
In the real world, the future direction for business property taxation is likely to depend, as is always the case for public policy, on a combination of popular perceptions of what is proper and prudential, views that surely will differ from state to state. Also important will be the differential persuasiveness of groups and organizations acting solely in their own self-interest, which surely will differ even more among the states.
The best forecast of that outcome is the experience of the recent past. If the recent past, say, the last fifteen to twenty years, does foretell the future in this regard, then we can be confident that overall the property tax role in state and local finance will decline somewhat over the next fifteen to twenty years, but not much--perhaps as little as two or three percentage points in such relevant measures as the property tax as a percentage of total state and local tax revenue, or of local government own- source revenue. We also can be confident that the property tax will become significantly less uniform (except perhaps in those states where there is no semblance of uniformity today--Third World domains like New York, for example), both with respect to the distinction between business and residential property and among types of business assets and industries. 1
But are these likely developments a good thing? Should they happen? Answers to those questions are a large part of the discussion in this volume. The answers call for some theory about what is best for the country, and for some consideration of policy alternatives. That is the subject matter of this paper.
It is not wise to propound strong theoretical rules about so complex an institution as the American property tax, because such rules easily can be shown to be