Ax the Tax: Is Eliminating Property Taxes the Next Frontier of Economic Freedom?
When I first started working on eliminating property taxes in Texas more than a decade ago, most people thought the idea was politically impossible.
Hello Friends!
Across America, frustration with property taxes is boiling over. From Texas to Florida, from North Dakota to Montana, leaders and citizens alike are questioning why one of the oldest, most burdensome forms of taxation still exists. Property taxes penalize ownership, undermine wealth-building, and create economic insecurity for families already struggling to cope with rising housing costs.
I’ve been working on this issue for over a decade, beginning with my mentor, The Honorable Talmadge Heflin, at the Texas Public Policy Foundation. Chairman Heflin had been advocating for the elimination of property taxes in Texas since the 1980s, and together with our colleagues, we revisited different iterations of how it could work best. The lesson was always the same: until you limit government spending, tax relief will never last.
That principle is more relevant today than ever.
Property Taxes: A Modern Wealth Tax
Property taxes function like a recurring, unrealized wealth tax. Even if you’ve paid off your mortgage, you never truly own your home—miss a payment to the government, and you risk losing it. It’s a system that takes not just your income, but your legacy, robbing families of the ability to build and pass down wealth.
This isn’t just an abstract problem. In places like Texas, property taxes are fueling a housing affordability crisis. Families spend over half their income to keep a roof overhead. Renters, too, feel the sting, as property taxes are often passed through in higher rents—accounting for 20% or more of monthly payments. Property taxes don’t just take dollars; they erode the very possibility of homeownership and security.
It’s a moral issue as much as an economic one. God gives us the inalienable right to enjoy the fruits of our labor so that we may serve Him. When the government lays perpetual claim to property, it violates that right. A tax system that forces families to rent their homes from the state is not only unjust, it is fundamentally un-American.
The True Burden: Government Spending
Too often, debates over tax reform get lost in the weeds of “tax incidence,” regressivity charts, or whether the code balances on a so-called “three-legged stool.” But those frames miss the heart of the issue: spending is the true burden of government.
Taxes exist for one reason only: to fund a limited government. When the government spends beyond its proper role, no tax system will ever feel fair or sustainable. The spending increases by most state and local governments outpaced population growth plus inflation. That’s a key reason why property taxes keep climbing.
The solution isn’t to tinker around the edges with appraisal caps or homestead exemptions. Those “reforms” simply shift spending burdens without addressing the root problem: excessive government spending. What’s needed is a strict spending limit—modeled on something like Colorado’s Taxpayers’ Bill of Rights (TABOR), which restricts budget growth to no more than population growth plus inflation. Combine this with a requirement that any revenue collected above that limit be used to reduce taxes, such as property tax rates, and you create a sustainable path to elimination.
Paths Toward Elimination
There’s more than one way to eliminate property taxes responsibly, and states are beginning to test different models. A few best practices stand out:
Surplus Buydowns: Limit state and local spending growth to no more than the average of population growth plus inflation. Use surplus revenues to buy down property tax rates over time. In a state like Texas, this could eliminate school district property taxes in a decade.
Sales Tax Replacement: Replace school district property taxes with a broad-based, flat sales tax on final goods and services—not a value-added tax or progressive rates. Because states largely control education funding formulas, this shift could cover roughly half of property tax collections without forcing the state to subsidize all local government spending.
Local Spending Limits and Compacts: Local governments must also live under population-plus-inflation spending limits. Over time, they can use surpluses or redirect existing revenues (like sales taxes) to reduce their remaining property taxes. Neighboring jurisdictions could form compacts to share services and harmonize tax bases, promoting efficiency without raising overall burdens.
Each of these approaches recognizes that eliminating property taxes isn’t about shifting burdens; it’s about restructuring government to live within its means while protecting taxpayers’ right to own property free and clear.
Housing Affordability: More Than Just Property Taxes
Eliminating property taxes is one of the most direct ways to relieve pressure on housing affordability, but it’s not the only factor driving costs. In states like Texas, Florida, and Montana, housing affordability is also being squeezed by restrictive zoning laws, minimum lot sizes, parking mandates, permitting delays, and other regulatory barriers that artificially inflate home prices.
For example, minimum lot sizes require developers to build on larger parcels than many families want or can afford, driving up costs unnecessarily. Zoning restrictions often prohibit multifamily housing or “missing middle” housing types, limiting supply even as demand surges. Add to that the long permitting delays in many fast-growing cities, and you have a perfect storm of limited supply and rising demand—exacerbated by high property taxes that make every square foot more expensive to own or rent.
This is why housing affordability must be addressed holistically. Cutting property taxes removes one of the most regressive and distortionary burdens. But unless states also tackle zoning and permitting reform, families will continue to face rising costs. It’s no coincidence that the most expensive housing markets in the country—from California to New York—combine heavy regulation with high property taxes. States that want to remain affordable must move in the opposite direction: leaner government, lighter regulation, and lower taxes.
Property Taxes Are Regressive in Practice
Some critics argue that property taxes are “progressive” because wealthier households own more property. But in reality, they are often more regressive than sales taxes. Analyses like the Texas Comptroller’s Suits Index show that property taxes fall disproportionately on lower- and middle-income families, and even more if they were to account for “lock-in” and “push-out” effects.
Lock-in occurs when homeowners stay in properties they might otherwise sell because higher property taxes elsewhere make moving unaffordable. Push-out occurs when rising taxes force families, especially retirees, to leave the homes they’ve long owned. Neither effect shows up in static incidence studies, but both represent real-world regressive impacts. By contrast, a broad-based, flat sales tax on final consumption is transparent, predictable, and more closely tied to the ability to pay.
The Lobby Against Reform
Of course, there are powerful interests that oppose eliminating property taxes. Lobbyists for appraisal districts, tax lawyers, government employees whose salaries rise with revenues, and the broader “property tax industry” all benefit from keeping the system alive. They warn that reform would be too disruptive. But in truth, they’re protecting their bottom line, not families being crushed by housing costs.
Their opposition only highlights the urgency of reform. A tax system that enriches bureaucracies while forcing families out of their homes is indefensible.
The Way Forward
I know some argue that eliminating property taxes entirely isn’t practical. But my answer is simple: if not this, then what? If the alternative is to keep families trapped in a cycle of renting from the government forever, that’s not a solution—it’s surrender.
The path forward is clear:
Tie government spending to at most population growth plus inflation.
Use surpluses to reduce property tax rates.
Replace school property taxes with a flat sales tax on final goods and services by the state.
Empower local governments to live within the same limits and eliminate their property taxes.
Reform zoning and permitting to better align supply with demand and improve housing affordability.
This isn’t just good economics, it’s about restoring inalienable rights, securing private property, and reviving free-market capitalism in a time when too many have drifted toward socialism. Taxes should never be used to control behavior or engineer society. They should exist only to fund limited government.
Property taxes are among the most destructive and unfair levies in existence. They punish ownership, distort housing markets, and act like a wealth tax on hardworking families. Eliminating them is the bold reform this moment demands.
It’s time for states to have the courage to act. The question is whether leaders will keep making excuses or finally give Americans the freedom to own their homes outright.


It’s a moral issue as well as an economic one and most of all UN-American. - 100%!!!
Goodness that was great! I continue to envision this happening as a colossal win for the American ppl 🇺🇸!!
Very true. I tried explaining this to Nebraskans but it is hard.