The property tax. For most middle class home owners, most of their net worth is tied to their house.

To make the property tax even more punitive, you are taxed not only on the portion of the house you own, but on the entire value of the house.

Wonky rant below......



Let's do a numerical example to show how punitive it can be.
Say we have a person who just purchased a house last year.


She bought the house for $300,000 with a standard 30 year mortgage. After a year's worth of payments she owns about $5,000 of the house.

She would pay property tax not just on the portion she owns (her wealth). But also on $295,000 the bank owns. In Texas, the average property tax rate is about 1.90%.
So her total property tax bill would be $300,000 x 1.90%= $5,700


For simplicity, let's say she has $40000 of other net wealth (savings + investments net of student loans, debt, etc).

Then her effective wealth tax would be $5,700/$45,000 = 13%


High net worth individuals don't come close to having wealth taxes like this. Not even under Warren's proposed plan. This is a disproportionate tax levied those who can least afford it.

And it doesn't just affect homeowners either. These taxes are passed through to renters as well. So they are indirectly affected by these existing punitive middle/lower class wealth taxes too.