Property Taxes and Consumption Smoothing

While no tax is likely to be widely celebrated, prior research suggests that property taxes are one of the more unpopular forms of taxation. A taxpayer’s experience with property taxes may vary depending on the form of payment. For households who escrow their property taxes, a constant monthly payment is made over the course of each year, and thus households are able to smooth their tax payments. For households who do not escrow their taxes, property taxes must be paid in a lump-sum manner each year. For the latter group, if households do not plan in advance, paying the tax bill may require costly adjustment of other consumption. In this study, we aim to compare spending patterns of households across the two groups to explore the relationship between large, predictable tax bills and other household spending and consumption patterns.

Presented by Damon Jones, Assistant Professor at Harris Public Policy.

Open to the public. Lunch will be provided.

Questions? Please contact ndeyagci@uchicago.edu.