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Which countries or US localities have experimented with abolishing property taxes and what were the outcomes?
Executive summary
No U.S. state has entirely abolished property taxes; every review in the provided set says property taxes exist everywhere in the U.S., though some states and individual cities keep very low or no municipal property levies (e.g., low‑tax states like Alabama, Hawaii and counties with tiny median bills) [1] [2] [3]. Internationally, several small countries or jurisdictions are frequently listed as having little or no annual property tax (examples named in the reporting include Monaco, Malta, Liechtenstein, Georgia and some Caribbean jurisdictions), but these sources note caveats like substitute stamp duties or other fees [4] [5].
1. U.S. reality check — “no state without property tax” is a myth
Every practical guide in the search set says there are no U.S. states that have eliminated property taxation entirely; instead, states differ by effective rates, exemptions and how much local governments rely on other revenue sources [1] [3]. Analyses underline that property taxes are chiefly levied locally (counties, cities, school districts), so a state’s headline rate can mask big local variation [6] [1].
2. Local experiments and carve‑outs — cities that don’t levy a city property tax
Several U.S. municipalities publicly advertise they do not collect a municipal property tax; but reporting stresses that “no city tax” often means only the city portion is zero while counties, school districts and other entities still collect property taxes or substitute fees (examples cited include Ballwin and Stafford; residents still pay county or district levies) [7]. MoneyTalksNews and other pieces caution homeowners to check which taxing jurisdictions still bill them [7].
3. Low‑tax states and counties — how experiments show tradeoffs
Magazines and tax guides list Southern and some Western states among the lowest effective property tax regimes (Alabama, Louisiana, Hawaii, North Dakota, West Virginia often appear) and identify counties with median annual bills under a few hundred dollars — typically rural areas with lower home values or different funding mixes [2] [6]. Analysts warn that lower property taxes can coincide with alternative revenue dependence (higher sales, fees, or less well‑funded local services), so low property levies are a policy choice with tradeoffs [3] [6].
4. International cases often cited as “no property tax” — and the catches
Lifestyle and offshore sites list jurisdictions that effectively impose no recurring property tax—Monaco, Malta, Liechtenstein, Georgia, Andorra and some Caribbean countries are named—but these pieces also note substitutes like stamp duties, residency conditions, or other taxes on ownership and transactions [4] [5]. The reporting frames these jurisdictions as attractive to investors and high‑net‑worth individuals but flags that other costs or rules (e.g., residency, VAT, income taxes on rental income) remain relevant [5] [4].
5. Outcomes reported — fiscal impacts and behavioral responses
The sources emphasize two recurring outcomes when property taxes are reduced or limited: [8] revenue shortfalls are shifted to other taxes or fees, or lead to cuts in services; and [9] lower property levies attract attention from investors and residents, but do not remove all housing‑related costs (higher sales taxes, stamp duties, or higher utility/fee schedules often follow) [3] [5]. Investopedia and tax trackers underline that places with lower property taxes tend to have different public‑service funding models rather than magically lower total tax burdens for all residents [6].
6. What the reporting does not show — true abolition experiments with long‑term evaluations
Available sources do not mention a U.S. state that has fully abolished property tax for all local governments on a permanent basis, nor do they present rigorous, multi‑decade empirical studies showing long‑term outcomes of a complete nationwide or state‑level abolition [1] [3]. The same gap appears internationally: outlets list “no property tax” jurisdictions but don’t provide systematic longitudinal evaluations comparing service quality, inequality, or fiscal stability after abolition [5] [4].
7. Practical takeaways for readers weighing relocation or policy proposals
If you want low property taxes, move to a state or county identified in tax rankings — but investigate which local entities still levy taxes and what alternative charges exist [2] [7]. Policymakers proposing abolition must plan for replacement revenues or service cuts; commentators repeatedly stress that low property taxes are a policy design with visible tradeoffs, not a free lunch [3] [6].
For further research: check local municipal and county tax codes (to confirm whether a city’s “no property tax” claim applies only to the city portion) and consult national tax‑policy analyses for formal studies on fiscal impacts (not found in the pieces cited above) [7] [3].