Who Really Owns Your Home?

Nick Giambruno |

A police officer pulled over Floyd Dent for a routine traffic stop.

A violent altercation followed.

The officer dragged Dent out of his car, appeared to put him in a chokehold, and punched him in the head. He then used his stun gun.

A disturbing but hardly unique encounter. These kinds of things happen all the time. It seems like there’s a new police abuse video uploaded to YouTube every day. In many cases, these incidents turn deadly. Dent is lucky the officer didn’t kill him on the spot.

But what’s really remarkable about this incident is that there was any kind of accountability at all. In many cases, the government and the fawning mainstream media sweep cases of police abuse under the rug. The State is extremely reluctant to hold its enforcers to account. But sometimes it’s forced to when overwhelming video evidence comes to light that sparks public outrage.

Once a video of the Dent incident became public, the officer lost his job. He’s now on trial, facing charges of mistreatment of a prisoner.

Dent also decided to sue the city of Inkster, Michigan, where the incident occurred. Surprisingly, he won. The city of Inkster settled for $1.4 million.

The problem is, Inkster doesn’t just have an extra $1.4 million laying around. So what did the local politicians do? They decided to squeeze a little extra juice out of the taxpayers, of course. They did this by raising property taxes.

A local media source estimates the new property tax will amount to about $179 on a home valued at about $55,400.

Now that doesn’t sound like a lot. But consider that the median income in Inkster is just $26,500 and that 40% of its people live below the poverty line. They simply don’t have an extra $179 to pay for a police abuse lawsuit which had nothing to do with them. The case has outraged people there, and rightly so.

There are a lot of things that are outrageous about this story. But there’s one that I find most instructive. And that’s the very concept of property tax. It’s an insidious perversion of property rights. How can you think you really own something that the government forces you to pay an insatiable and ever-increasing amount of tax on?

If you ask me, it’s impossible to truly own something that has a property tax attached to it. You would possess such an item, but you wouldn’t own it. It’s an important distinction. Stop paying your property taxes to find out who really owns your home. In actuality, you’re merely renting the home you thought you owned from the government.

Whenever politicians want to steal more money, they can simply increase property taxes and hope nobody notices. It’s like changing the dial on a thermostat. The Floyd Dent case showed this.

Turning to property taxes to quench a thirst for money is not unique to the politicians in Inkster, Michigan. It’s a universal feature built into the DNA of almost any politician in the world. Consider the bankrupt government of Greece. Here’s an excerpt from an article in The Guardian:

The joke now doing the rounds is: if you want to punish your child, you threaten to pass on property to them… Greeks traditionally have always regarded property as a secure investment. But now it has become a huge millstone, given that the tax burden has increased sevenfold in the past two years alone.

The sad reality is that there are few countries in the world that do not have a property tax. Fewer than 20 to be exact. We cover them in detail in Going Global. The only way to skip the annual property tax harvest is to own real estate in these countries.

It’s not just a matter of minimizing or eliminating property taxes, though. Yes, that’s extremely important. But foreign real estate offers a number of other tremendous benefits, too.

It’s a hard asset outside the immediate reach of your government. They cannot confiscate it without a literal act of war.

It opens the door for you to obtain an offshore bank account, residency, and maybe even citizenship, in another country.

It diversifies your portfolio and can bring income streams in a foreign currency if you rent it out.

These are but a few of the huge benefits foreign real estate can give you.

For a more detailed discussion, you may wish to check out Going Global 2015.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer


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