Proposition 15, if enacted, will raise taxes on all commercial properties. This proposed increase in taxes should have adverse effects on property owners and its tenants.
Several businesses have been closed due to the international pandemic. How can the government raise taxes on properties when those properties are closed by the law. Rents are still due by the tenants. Many tenants cannot afford their current rent since they are shut down. Further, an increase in the operating expenses which are either borne by the owner or its tenants. This would be chaos in the largest real estate economy in the US.
This potential increase in taxes may cause the owner of the real estate to go into foreclosure or could force its tenants to file for bankruptcy.
The economy is so fragile at this moment that any such maneuver by the taxing authorities may cause increased unemployment and cause the real estate market into a depression.
