Uniformity Does Not Preclude Land Value Taxes

Let's not stress ourselves, most states do not require a constitutional amendment to implement land value taxes.

I have worked across jurisdictions in various capacities to advance land value tax shifts. There are several common roadblocks when starting these conversations, and often, those in the land value tax community are the first to mention state uniformity clauses.

For those unfamiliar, the vast majority of states have “uniformity clauses” in their constitutions, requiring that property taxes be applied uniformly across classes of property. These clauses were included when state constitutions were adopted to prevent the unfair targeting of specific people or groups.

However, uniformity clauses are not as significant a barrier as some suggest. In fact, versions of land value tax are likely constitutional in most states. While state legislatures may need to authorize or approve such proposals, policy changes are often more achievable at the state level than at the federal level.

To understand uniformity, let’s look at Pennsylvania’s constitution, Article 5 Section 1:

All taxes shall be uniform, upon the same class of subjects, within the territorial limits of the authority levying the tax, and shall be levied and collected under general laws.

If land and buildings are considered one class (real property), then a property tax cannot have different rates for land and buildings. The interpretation that uniformity clauses prohibit higher taxes on land than buildings often overlooks the unique differences between the two.

Uniformity clauses require that taxpayers within a defined constitutional class receive equal treatment under the law, but they do not mandate identical treatment of fundamentally dissimilar subjects. A proper framework begins by defining the constitutional class, then permits subclassification when objective, rational distinctions exist—such as differences in economic function or benefits received—rather than arbitrary differentiation (for example, targeting Paul’s property over Lisa’s as a political vendetta). Under this analysis, taxing land differently from improvements is justified because external, public factors drive land’s value, while improvements reflect the owner’s personal investment.

Pennsylvania has recognized the distinction between land and improvements. For example, look at Philadelphia’s 10 year tax abatement, or the more generally available LERTA program. This precedent has allowed cities across the state to implement land value taxes successfully. However, not all uniformity clauses are created equal.

Consider Washington’s constitution, Article 7 Section 2:

The legislature shall provide by law a uniform and equal rate of assessment and taxation on all property in the state.

Washington defines “all real estate shall constitute one class.” Therefore, the Washington constitution precludes treating land and buildings separately under the uniformity clause.

However, the same section provides exceptions:

Provided, further, that the property of the United States and of the state, counties, school districts and other municipal corporations, and such other property as the legislature may by general laws provide, shall be exempt from taxation.

The key here is that the state legislature may exempt certain property from taxation. If the state universally exempted buildings, or allowed cities to do so, then a land value tax shift could be effectively implemented.

ChatGPT Generated Cartoon

Washington has enabled cities to enact exemptions before. The Seattle Multifamily Housing Tax Exemption (MFTE) program specifically avoided violating the uniformity clause because it was explicitly authorized by state legislation. In 1995, the Washington State Legislature adopted RCW Chapter 84.14, which provides for “special valuations in residentially deficient urban centers for eligible improvements associated with multiunit housing.” In essence, cities can choose to exempt property taxes for specific new housing developments.

States use different but equivalent language, and each interprets uniformity differently. Regardless, the takeaway is that uniformity clauses do not need to be overturned to implement land value taxes. Most states have some version of tax exemptions, abatements, or credits. While many states control these, they often can or do enable cities to structure exemptions as they see fit.

Even without uniformity clauses, states set guardrails over local property taxes that would put us in the same position. For example, New York, Iowa, and Connecticut have no uniformity clause. Yet in New York, state statutes regulate how cities operate their property taxes, including a requirement for a single tax rate on land and improvements. Yet in New York State, the city of Amsterdam enacted a land value tax in the face of this, using the strategy of a “home rule message.” In this sense, the problem is not with uniformity clauses. Iowa and Connecticut similarly restrict cities’ ability to enact land value taxes through state code.

So, uniformity is not the real challenge. The need for state approval exists regardless.

This may sound like a distant dream, but state politics are often more reasonable than expected. Maryland, Minnesota, and New York are all considering enabling cities to enact split-rate taxes. Maryland has already enabled cities and is now looking to enable counties; Connecticut has previously allowed five cities to pilot land value taxes; and Virginia has enabled four of its cities to implement split-rate taxes.

The key is to work with both cities and states. City council members everywhere are looking for ways to encourage development, and many are familiar with and supportive of land value taxes. For those new to the idea, the pitch is simple: let’s tax buildings less so we can build more. Let’s give cities access to this tool.