Descriere
Taxation of real estate properties based on „market value” is often presented as a modern and equitable solution, aligned with the practices of developed countries. This article critically examines
this fiscal policy option in the specific context of Romania, a middle-income state with limited administrative capacity and insufficient social protection mechanisms. The central argument is that the
mechanical transfer of a value-based system generates major risks for fiscal predictability and the security of property rights.
Contrary to the theoretical hypothesis, in the absence of institutional corrections (growth caps, calibrated reassessments, social exemptions), taxation based on market fluctuations transfers volatility
from the state to the taxpayer. This has profoundly asymmetric effects: during periods of rising prices, taxpayers face sudden tax increases without corresponding increases in income; during periods of decline, the tax administration cannot rapidly adjust assessments. The result is the erosion of fiscal predictability and the impairment of property rights security.
Comparative analysis reveals that states which utilize market value do so only within the framework of robust fiscal institutions that limit volatility. In the absence of such institutions in Romania,
the solution becomes a generator of systemic risk. The article concludes that market value taxation represents a fiscal policy error in the current Romanian context, advocating for more stable and
objective tax bases.
