Let's get facts straight. The state property tax in Greece is calculated on a nominal value far removed from market value. This means that a 300K nominal value property cannot sell today for 150K (I know, I have tried.) In practice, as the article mentions property value approaches zero as the market is incredibly shallow. Recalculate on the basis of that and then make the comparison.
I would assume one can challenge that valuation with the tax authority or through the courts. A building isn't actually worth €300k if it can't be sold for €300k. If I buy something from a third party for €100k today, it's worth exactly that.
Tax lawyers are expensive. If people can't even pay the tax, how would they afford a tax lawyer? I have achieved beneficial settlements with unreasonable tax collectors with a good lawyer, so often it is that easy.
I didn't pretend to describe all the rules in detail. In Denmark, property taxes are also calculated based on values that are not the current market value. Currently, 95% of Danes pay the state property tax based on a 2001/2002 value assessed by the tax authorities.
In the larger cities, prices have surged over the past 15 years, in more remote areas, they have fallen slightly. There are plans on the table ATM to bring taxation in better line with valuation. As one may predict, this is not popular with city folks who imagined the tax rebate to be a perpetual thing.
I didn't pretend anything. Even if your property is taxed at €500k although it's worth €250k, you are still paying very little compared to Denmark. And actually, it is close to zero.
Many of my friends, all middle class, pay €5-10k per year in property taxes for what is really modest 100-150m2 apartments or houses in or around Copenhagen. Are you anywhere close to that in Athens?
Yes, easily more than €5k/year for a 120m2 house. (not me actually, my parents, but I doubt they lie to me about how much they spend)
Like others have already mentioned in other threads, land & property valuations are defined by the state, and are way inflated and unrealistic. On top of that, there's all these ridiculous things that contribute to the property tax, like how many streets neighbor the building, etc.
If the market is perverted or highly irrational, it does make some sense. For example, just because there are no buyers on the market, doesn't mean your home has no value. (Think of black markets. It's hard to find a buyer, but the item definitely has value) And many governments depend in part on property taxes, it would be a double crisis if a perverse stagnant housing market also bankrupted your government.
The scheme for a fair nominal value assessment does seem challenging to come up with, though. Perhaps you anchor your valuations in a past year, e.g. "what this house would have sold for in 2002".
If it's a pure property tax (as opposed to a LVT) the simplest way to do it is to either (i) let the government set the taxable valuation but oblige them to buy the house at that price (plus a premium) if the owner disputes it or (ii) let the owner value the house but grant the government the right to buy the house at that valuation (plus a premium) if they dispute the valuation.
Both options have the side effect of potentially adding a bit of liquidity to the housing market in a downturn.
