Housing Demand and Property Tax Incidence in a Life-Cycle Framework

Studies of tax incidence usually present estimates based on annual data and then simply note that estimates based on lifetime information would be preferable, but are precluded by data limitations. This paper presents estimates of property tax incidence in both an annual and life-cycle framework. If full forward shifting is assumed, the property tax appears much less regressive in a lifetime sense than an annual one. If less than full forward shifting is assumed, the property tax appears to be a flat tax in lifetime terms, which is quite distinct from the annual results.