I'm a Delawarean, and I have done research and reporting about the state's unique role in corporate America.
You may wonder why two-thirds of the Fortune 500 are incorporated in Delaware. Is it because the cost of incorporation is lower than in other states, or because corporate tax rates are lower? Those are factors, but they are not the primary reason. The primary reason is risk avoidance, and in particular legal risk avoidance.
Delaware benefits from a flywheel effect: Because so many companies are incorporated in the state, its Chancery Court has a more developed set of case law than other states, and so outcomes of lawsuits involving corporations are more predictable -- which makes it an even more attractive place to incorporate, which continues the flywheel effect.
The down side is that the state is incredibly dependent on corporate licensing fees and escheatment. States like Nevada have, in recent years, been competing against Delaware as a corporate haven, and if we start to see a significant migration, we'll be in a real pickle, because the state imposes no sales tax and has relatively low property taxes.
Off topic: I’ve never seen a flywheel analogy that actually understands what a flywheel is. People love to use it to describe a forever growing thing, when it’s actually just a buffer.
In this case, the flywheel analogy only demonstrates is that there is low friction in the legal system aspect.
If we are talking about a flywheel as an energy storage, low friction is a key component of its ability to store energy as a buffer. If this was not the case, the flywheel would lose its energy quickly on its own and the buffer would be gone.
> People love to use it to describe a forever growing thing, when it’s actually just a buffer.
A thing has other characteristics other than its intended purpose. Your assumption that you need to use intended purpose for a successful analogy is false.
Alaska gets a huge portion of its revenue from taxes on extracting oil and gas. This is a model that any state could use on data centers extracting compute from local resources. And if demand for compute is actually heading up the Kardashev scale, it could eventually fund the whole state and subsidize resident incomes. It would act as a hedge against possible disruptions by AI.
Land Value Tax does this with effectively zero enforcement complexity and across all forms of communal wealth creation (which ultimately gets baked into land values).
Could you explain this?
I thought the idea of Land Value Tax was that the value of land gets taxed regardless of how much value is generated by use of that land. (e.g. a vacant lot is taxed the same as a lot with rental properties built on top given everything else equal.)
No it doesn't. Land tax doesn't target data centers, which usually want cheap land.
Further, when land taxes are passed down, they focus of physical goods and ignores IP and contract value. This means they are more flatly distributed throughout the population.
Third, many high return activities require almost no land. A stock trader or bank might make millions with the nanowatt of natural resources needed to flip a bit in a database. A plumber might need a lot of natural resources to fix your toilet
"Datacenters" is needlessly narrow -- as capital eats the world, we need to tax capital. Simple as.
We already tax houses, and by comparison stocks are more liquid than a firehose and easier to value than a $2 bill. There is no excuse.
As I have grown my small business, I have come to an appreciation for how comically lopsided the tax code is to push all of the taxes out of the invest/return economy and into the work/consume economy. It's really quite something. Anything to avoid the right side of the Kuznets Curve!
Florida passed their ballot initiative (https://www.msn.com/en-us/money/other/what-the-new-florida-h...) to begin exempting non-school portions of property tax (a bit over 1/3 of state revenue). This is a concern in my industry, which derives budgets primarily from property taxes. But, more generally: what is the plan for the revenue shortfall? Any Floridians have insight? Does FL not need this money, assume they will make it up in a sales tax because of increased disposable income, or they are just fine with the services based on this revenue getting rinsed?
Options are increase millage rate, increase user fees, spending cuts, state revenue sharing, and sales tax increase (limited and must be voter approved)
Its a homestead exemption. Folks just living in their homes will be under less pressure to sell. Folks renting out homes will continue to pay full tax. With the behavior of property valuations, this seems rather humane.
My question was about the impact to state revenues and associated services. Are you suggesting that because it doesn't apply to "investment" homes, the actual impact to state coffers will be minimal?
Not being nitty, just didn't follow how your point connected and wanted to make sure I understood it.
But that would just show you some states are much bigger than others? I think per capita dollars, or normalized to that state's median income would be more informative.
Well, yeah, OR doesn't have a general sales tax so it's proportionally more dependent on income tax. vice versa for WA, no personal income tax so depends more on sales tax.
This is an interesting chart, but it really is showing one policy dimension - choice of tax base.
Oregon, where we get taxed to hell on both income and property yet still have decrepit infrastructure, declining publicly funded healthcare(OHA), and poor education.
I suspect "other" is mining or equivalent natural exploitation(oil)
And pet peeve, personal income tax and corporate income tax are almost the same thing. With few exceptions the individual person does not pay their income tax, the corporation does, and for those exceptions the individual is the corporation. Income tax is really a sales tax on a corporation biggest expense, it's payroll.
Corporate income tax is a very different thing from an employer withholding wages. Withholding is still considered the individual paying the tax, just they never get to hold the money. Corporate income tax is money the corporation pays based on its own income vs expenses.
You can also just go to your employer’s HR software and change withholding to 0% everywhere I’ve worked, giving you a bigger paycheck but moving the burden of paying the IRS on you.
You still need to do the withholding or pay a penalty at tax time. I suppose you can pay quarterly instead of biweekly (or whatever), but is it worth it?
A good portion of revenue is from property taxes. A property tax is a wealth tax. I always find the discussion interesting around wealth taxes on billionaires equity when the average worker has typically always paid a wealth tax on their largest asset.
A property tax is not a wealth tax, in any common meaning of 'wealth tax'. It's a property tax. The majority of people with real wealth own assets outside of property that they derive income from. Notably, the vast majority of people own property they do not derive income from, e.g. their homes.j
A tax on a home not deriving income does not fit any normal person's definition of a wealth tax.
What? Property taxes are definitionally a wealth tax. It's also probably the most efficient/best one. It's also part of the common meaning of the wealth tax because its the one that most people experience.
People determined not wealthy enough to get a mortgage do not pay property taxes on a house they are not wealthy enough to own.
Those wealthy enough to own a house pay property taxes; ergo wealth tax.
Over the years different explanations were written down as legal justifications "why it's different than this other very similar scenario" but people of the past were just making something up to not look hypocritical; someone with the means is taxed more for the privilege is how it goes. Poor people don't pay taxes.
You're doing that thing where you appeal to subtle complexity that doesn't exist as anything but a social trope; there is no real physical complexity to any of this; the complexity is all made up rhetorical gotchas.
It's like scaffolding out the Windows pipes screensaver in your head; endless bends and bends while no pipes actually exist. There is no spoon; it's just primates parroting the bird song they have been whistling since youth.
The tax is the same regardless of the equity or "wealth". I can be underwater on my mortgage with a negative net-worth and still owe the same property taxes on someone with a comparable house and $2 million in the bank.
Yeah? And? You don't get a mortgage and pay the tax in the first place without being wealthy enough; poor people don't get to own a home and don't pay property tax (excepting for those in rentals who proportionally subsidize the payments the landlord makes).
It's fundamentally a tax on wealthier people among a community.
We really going to sit here in 2026 and pretend the people who wrote down all these rhetorical circumlocutions weren't just making up language to justify their supposed expertise/their social moat? The entire American system is rich families manipulating the legal system to screw have nots. Whole lot of have nots defend a system that doesn't care they exist.
Strip away the ornamental language of the law and just see the ground truth; a person with means to buy the house pays a tax on it all. A poor person never pays a tax because they never own a home.
What is this? Why does everyone feel like they stepped out of the middle ages where dark tongues still exist and the ornate incantations of superstitious people still rule?
It doesn't need to be logically as complicated and intentionally obscured (in my opinion legalese has been to manipulate the illiterate which were the majority back in the day).
Property taxes are not wealth taxes. Two houses side-by-side with the same value, should have the same property tax assessed. One is owned outright. The other is mortgaged to the hilt and its 'owner' has very little wealth from it.
I don’t understand this “loop hole”, who is giving loans that don’t have to be repaid? Surely the collateral will be sold eventually to repay the loan and service the interest?
If you are a good customer of the bank and the LTV of the collateral is very low, then you will get a very low interest rate. If the collateral pays dividends (which are also taxed at a lower rate than ordinary income), then the dividends can service the interest. Meanwhile capital gains keep accumulating tax-free.
Refinance the loan with another loan or just use a revolving credit account with no fixed term.
If your stock holdings are growing faster than inflation and the interest rate at which you are borrowing, it’s an easy way to monetize unrealized gains without a taxable event. If you have a huge stock portfolio, brokers will lend you money against your stock at very low rates, a few bps above what Treasuries yield. If you have $4B of stock they might let you borrow $1B for what would be ~4-4.5% using that stock as collateral. You can theoretically take out a margin loan for up to 100% of the stock held in an account, but that’s risky due to margin calls.
The idea is to let the cost basis step up to the price of the asset at your death which will eliminate the capital gains that would’ve been owed. Then your heirs sell a portion of the stock to pay off the loan and keep the rest.
> If buy-borrow-die were the dominant playbook, the rich would be leveraging aggressively against their ballooning portfolios. They aren’t. Borrowing against unrealized gains is, if anything, more of a middle-class habit than a billionaire one.
Can you elaborate more on why you don’t think a property tax is not a wealth tax? My understanding is that a wealth tax is a tax on the value of an asset. The asset could be a variety things that have net worth
Also, not all states apply property taxes the same. In my state, my house is assessed often by the government and then my taxes rise based on the value of my house.
Property tax is a tax on specific property (usually we are talking about real property, but I've paid e.g. property tax on a car). It is usually irrespective of wealth.
Someone who buys a house with cash and their neighbor who is underwater on their mortgage and at risk of insolvency will pay the same tax.
Note also that you rarely see property taxes on e.g. valuable jewelry because unlike real property and cars, both of which have ownership centrally registered, jewelry is not centrally registered.
Here's a website that would have been significantly better if it had been written using AI. HN readers complain about "AI slop" but I would prefer AI slop over this site. Folks, if you are not motivated to make a decent page, please use AI.
Just curious, because it looks fine to me(ad blocker?), but there were other comments saying how terrible it is, what is wrong with it?
Header large image, small pointless article, see also navigation. Sure nothing exceptional, but also, nothing offensive, looks like every other "news site" I have seen.
I'm a Delawarean, and I have done research and reporting about the state's unique role in corporate America.
You may wonder why two-thirds of the Fortune 500 are incorporated in Delaware. Is it because the cost of incorporation is lower than in other states, or because corporate tax rates are lower? Those are factors, but they are not the primary reason. The primary reason is risk avoidance, and in particular legal risk avoidance.
Delaware benefits from a flywheel effect: Because so many companies are incorporated in the state, its Chancery Court has a more developed set of case law than other states, and so outcomes of lawsuits involving corporations are more predictable -- which makes it an even more attractive place to incorporate, which continues the flywheel effect.
The down side is that the state is incredibly dependent on corporate licensing fees and escheatment. States like Nevada have, in recent years, been competing against Delaware as a corporate haven, and if we start to see a significant migration, we'll be in a real pickle, because the state imposes no sales tax and has relatively low property taxes.
Off topic: I’ve never seen a flywheel analogy that actually understands what a flywheel is. People love to use it to describe a forever growing thing, when it’s actually just a buffer.
In this case, the flywheel analogy only demonstrates is that there is low friction in the legal system aspect.
If we are talking about a flywheel as an energy storage, low friction is a key component of its ability to store energy as a buffer. If this was not the case, the flywheel would lose its energy quickly on its own and the buffer would be gone.
> People love to use it to describe a forever growing thing, when it’s actually just a buffer.
A thing has other characteristics other than its intended purpose. Your assumption that you need to use intended purpose for a successful analogy is false.
Ah yes, I too have noticed the "prevalence of flywheel-analogy-misuse" flywheel.
Alaska gets a huge portion of its revenue from taxes on extracting oil and gas. This is a model that any state could use on data centers extracting compute from local resources. And if demand for compute is actually heading up the Kardashev scale, it could eventually fund the whole state and subsidize resident incomes. It would act as a hedge against possible disruptions by AI.
Land Value Tax does this with effectively zero enforcement complexity and across all forms of communal wealth creation (which ultimately gets baked into land values).
Data centers use small amounts of cheap land.
Could you explain this? I thought the idea of Land Value Tax was that the value of land gets taxed regardless of how much value is generated by use of that land. (e.g. a vacant lot is taxed the same as a lot with rental properties built on top given everything else equal.)
No it doesn't. Land tax doesn't target data centers, which usually want cheap land.
Further, when land taxes are passed down, they focus of physical goods and ignores IP and contract value. This means they are more flatly distributed throughout the population.
Third, many high return activities require almost no land. A stock trader or bank might make millions with the nanowatt of natural resources needed to flip a bit in a database. A plumber might need a lot of natural resources to fix your toilet
"Datacenters" is needlessly narrow -- as capital eats the world, we need to tax capital. Simple as.
We already tax houses, and by comparison stocks are more liquid than a firehose and easier to value than a $2 bill. There is no excuse.
As I have grown my small business, I have come to an appreciation for how comically lopsided the tax code is to push all of the taxes out of the invest/return economy and into the work/consume economy. It's really quite something. Anything to avoid the right side of the Kuznets Curve!
They need to show distribution of federal funds because it is not fairly allocated.
This is about tax revenue, not overall stock of usable funds.
It's about the proportional distribution.
Florida passed their ballot initiative (https://www.msn.com/en-us/money/other/what-the-new-florida-h...) to begin exempting non-school portions of property tax (a bit over 1/3 of state revenue). This is a concern in my industry, which derives budgets primarily from property taxes. But, more generally: what is the plan for the revenue shortfall? Any Floridians have insight? Does FL not need this money, assume they will make it up in a sales tax because of increased disposable income, or they are just fine with the services based on this revenue getting rinsed?
Options are increase millage rate, increase user fees, spending cuts, state revenue sharing, and sales tax increase (limited and must be voter approved)
Its a homestead exemption. Folks just living in their homes will be under less pressure to sell. Folks renting out homes will continue to pay full tax. With the behavior of property valuations, this seems rather humane.
My question was about the impact to state revenues and associated services. Are you suggesting that because it doesn't apply to "investment" homes, the actual impact to state coffers will be minimal?
Not being nitty, just didn't follow how your point connected and wanted to make sure I understood it.
Doesn't affect the state just localaties like counties and cities.
What is the New Mexico and North Dakota other source?
Interesting as a percentage but convert the axis to actual dollars for the real story.
But that would just show you some states are much bigger than others? I think per capita dollars, or normalized to that state's median income would be more informative.
A few observations (these are all on a relative basis, as the chart shows):
- NH gets nearly 2/3 of its revenue from property taxes
- OR raises more of its revenue than CA in income tax
- TN/AZ are a close 2nd/3rd to WA in sales tax revenue
Well, yeah, OR doesn't have a general sales tax so it's proportionally more dependent on income tax. vice versa for WA, no personal income tax so depends more on sales tax.
This is an interesting chart, but it really is showing one policy dimension - choice of tax base.
Oregon, where we get taxed to hell on both income and property yet still have decrepit infrastructure, declining publicly funded healthcare(OHA), and poor education.
Eastern or Western Oregon? Because there are big political, economic and geographical differences between the two.
Won't you still be (indirectly) paying property tax, as your landlord needs to recoup?
Yes but you can get below market rents from owners who don’t have a mortgage to pay.
The WA sales tax I suppose explains why a fast food burger requires a down payment.
although it seems the workers aren't relying on tips as their salary, which hopefully means you can actually tip when it makes sense to.
11% corporate income tax in Idaho surprised me, given how heavily conservative they tend to vote.
Clicking “use this visualization” gives you image version that doesn’t cause seizures
I suspect "other" is mining or equivalent natural exploitation(oil)
And pet peeve, personal income tax and corporate income tax are almost the same thing. With few exceptions the individual person does not pay their income tax, the corporation does, and for those exceptions the individual is the corporation. Income tax is really a sales tax on a corporation biggest expense, it's payroll.
Corporate income tax is a very different thing from an employer withholding wages. Withholding is still considered the individual paying the tax, just they never get to hold the money. Corporate income tax is money the corporation pays based on its own income vs expenses.
You can also just go to your employer’s HR software and change withholding to 0% everywhere I’ve worked, giving you a bigger paycheck but moving the burden of paying the IRS on you.
You still need to do the withholding or pay a penalty at tax time. I suppose you can pay quarterly instead of biweekly (or whatever), but is it worth it?
that website is cancer, just for an image
That is why I read the HN comments before going to the site :). Thanks!
Opening the page with uBlock Origin and NoScript, the image and article text show just fine.
Some sites these days won't show anything at all without Javascript, so I actually give the site kudos for working well with no Javascript.
Evidently Javascript causes cancer.
It is called the visual "capitalist" for a reason it seems.
I wonder if Delaware's massively oversized license tax portion is simply because so many companies incorporate there.
Yes
A good portion of revenue is from property taxes. A property tax is a wealth tax. I always find the discussion interesting around wealth taxes on billionaires equity when the average worker has typically always paid a wealth tax on their largest asset.
A property tax is not a wealth tax, in any common meaning of 'wealth tax'. It's a property tax. The majority of people with real wealth own assets outside of property that they derive income from. Notably, the vast majority of people own property they do not derive income from, e.g. their homes.j
A tax on a home not deriving income does not fit any normal person's definition of a wealth tax.
What? Property taxes are definitionally a wealth tax. It's also probably the most efficient/best one. It's also part of the common meaning of the wealth tax because its the one that most people experience.
https://projectionlab.com/financial-terms/wealth-tax
Yeah agreed; what they even saying?
People determined not wealthy enough to get a mortgage do not pay property taxes on a house they are not wealthy enough to own.
Those wealthy enough to own a house pay property taxes; ergo wealth tax.
Over the years different explanations were written down as legal justifications "why it's different than this other very similar scenario" but people of the past were just making something up to not look hypocritical; someone with the means is taxed more for the privilege is how it goes. Poor people don't pay taxes.
> Poor people don't pay taxes.
Poor people (typically) don't pay income taxes.
This is why it's worth knowing the difference between progressive and regressive taxes.
You're doing that thing where you appeal to subtle complexity that doesn't exist as anything but a social trope; there is no real physical complexity to any of this; the complexity is all made up rhetorical gotchas.
It's like scaffolding out the Windows pipes screensaver in your head; endless bends and bends while no pipes actually exist. There is no spoon; it's just primates parroting the bird song they have been whistling since youth.
The tax is the same regardless of the equity or "wealth". I can be underwater on my mortgage with a negative net-worth and still owe the same property taxes on someone with a comparable house and $2 million in the bank.
Yeah? And? You don't get a mortgage and pay the tax in the first place without being wealthy enough; poor people don't get to own a home and don't pay property tax (excepting for those in rentals who proportionally subsidize the payments the landlord makes).
It's fundamentally a tax on wealthier people among a community.
We really going to sit here in 2026 and pretend the people who wrote down all these rhetorical circumlocutions weren't just making up language to justify their supposed expertise/their social moat? The entire American system is rich families manipulating the legal system to screw have nots. Whole lot of have nots defend a system that doesn't care they exist.
Strip away the ornamental language of the law and just see the ground truth; a person with means to buy the house pays a tax on it all. A poor person never pays a tax because they never own a home.
What is this? Why does everyone feel like they stepped out of the middle ages where dark tongues still exist and the ornate incantations of superstitious people still rule?
It doesn't need to be logically as complicated and intentionally obscured (in my opinion legalese has been to manipulate the illiterate which were the majority back in the day).
Such social conservatism is holding society back.
Property taxes are not wealth taxes. Two houses side-by-side with the same value, should have the same property tax assessed. One is owned outright. The other is mortgaged to the hilt and its 'owner' has very little wealth from it.
I wonder if we should pass a law where borrowing against an asset is a taxable event.
At least it closes the loop hole where you borrow against your stock and never pay taxes on it because you never sold it.
I don’t understand this “loop hole”, who is giving loans that don’t have to be repaid? Surely the collateral will be sold eventually to repay the loan and service the interest?
If you are a good customer of the bank and the LTV of the collateral is very low, then you will get a very low interest rate. If the collateral pays dividends (which are also taxed at a lower rate than ordinary income), then the dividends can service the interest. Meanwhile capital gains keep accumulating tax-free.
Refinance the loan with another loan or just use a revolving credit account with no fixed term.
If your stock holdings are growing faster than inflation and the interest rate at which you are borrowing, it’s an easy way to monetize unrealized gains without a taxable event. If you have a huge stock portfolio, brokers will lend you money against your stock at very low rates, a few bps above what Treasuries yield. If you have $4B of stock they might let you borrow $1B for what would be ~4-4.5% using that stock as collateral. You can theoretically take out a margin loan for up to 100% of the stock held in an account, but that’s risky due to margin calls.
The idea is to let the cost basis step up to the price of the asset at your death which will eliminate the capital gains that would’ve been owed. Then your heirs sell a portion of the stock to pay off the loan and keep the rest.
You know, every time this is brought up, a small part of me dies.
People bring up a loophole that does exist, and assume that everyone uses it. Welp, like most of these "1%" discourse, its pretty damn rare.
https://taxprofblog.aals.org/2026/06/16/fox-and-liscow-the-r...
> If buy-borrow-die were the dominant playbook, the rich would be leveraging aggressively against their ballooning portfolios. They aren’t. Borrowing against unrealized gains is, if anything, more of a middle-class habit than a billionaire one.
Can you elaborate more on why you don’t think a property tax is not a wealth tax? My understanding is that a wealth tax is a tax on the value of an asset. The asset could be a variety things that have net worth
Also, not all states apply property taxes the same. In my state, my house is assessed often by the government and then my taxes rise based on the value of my house.
A wealth tax is a tax on your net wealth.
Property tax is a tax on specific property (usually we are talking about real property, but I've paid e.g. property tax on a car). It is usually irrespective of wealth.
Someone who buys a house with cash and their neighbor who is underwater on their mortgage and at risk of insolvency will pay the same tax.
Note also that you rarely see property taxes on e.g. valuable jewelry because unlike real property and cars, both of which have ownership centrally registered, jewelry is not centrally registered.
Here's a website that would have been significantly better if it had been written using AI. HN readers complain about "AI slop" but I would prefer AI slop over this site. Folks, if you are not motivated to make a decent page, please use AI.
Just curious, because it looks fine to me(ad blocker?), but there were other comments saying how terrible it is, what is wrong with it?
Header large image, small pointless article, see also navigation. Sure nothing exceptional, but also, nothing offensive, looks like every other "news site" I have seen.
Turn off your adblocker and experience auto-playing and unmuted video ad popups that cover most of the display.