All bitcoin is "unbacked". There's no intrinsically useful asset behind bitcoin. Your private key is just a bundle of bits. Bits are so abundant as to be worthless.
The question is: why is one called fractional reserve banking, a behavior that is acknowledged to increase the money supply, and the other one called "oh no this is definitely not increase of the money supply, it's just you relinquishing custody of your bitcoin and why would you do that, there's no reason you'd ever do that".
A currency is not backed by land value. It’s usually “backed” by a combination of sovereign debt obligations and its status as legal tender.
There are no annual property taxes in El Salvador :)
But this may be a technicality, based on the Salvadoran legal definition of the term. So it really depends on what is understood as tax in each jurisdiction.
El Salvador law differentiates between taxes and fees. Taxes are born from an "generating action", like selling a computer generates sales tax. While Fees are born from a "service provided" .
So there are monthly fees payable to the local city/town/village hall based on property size and location for services they provide in that area Some common ones are garbage collection, CCTV, city lighting, road maintenance and the contribution for each City/Town annual Festival. A monthly fee for each town's annual party :O Does that exist in other countries?
So once you get your city hall invoice, and wanted to pay in bitcoin, you'd have to visit the city hall to pay in their bitcoin terminal.
At least four city halls are connected to BitRefill which allows online invoice payments using Bitcoin/Lightning. BitRefill connects to a local payment network, then the user types or scans the Invoice barcode, and makes the bitcoin payment for the fees bill.
If it's some wrapped Bitcoin that is backed, that means that there exists some UTxO which corresponds to the wrapped bitcoin tokens you hold. UTxO are atomic and unique so you can verify that your wrapped tokens have a 1:1 mapping to the tokens held within the UTxO on the native token's network. Non-backed bitcoin instead are just tokens that are handled through some minting mechanism where there is claimed to be a 1:1 equivalence without any actual tooling to prove that.
This concept of backing can actually even be further extended via Secure Multi-Party Computation where private keys can be collectively held in such a way that no user ever can see the private key but together they can coordinate to build and sign transactions with that private key without leaking it even to themselves. This can then be used to actually hold tokens from a foreign/incompatible network and interact with that network with little to any required trust.
Hopefully that helps answer what is meant.
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Also since it's often a question asked I'll answer preemptively: "What is UTxO?"
I've mentioned the UTxO accounting model a few times here. Bitcoin doesn't have accounts but rather UTxO or Unspent(U) Transaction(Tx) Outputs(O). These are indivisible bundles of tokens that can only be created or consumed/destroyed atomically. There are no accounts but rather just private/public key pairs which can redeem/spend those UTxO. Additionally, all transactions are just a collection of input UTxO (that are consumed with the tx) and newly created UTxO. All Tx must uphold the rule that the sum of all inputs equal the sum of all outputs (or some equivalent of this rule as is the case for Monero's Zero Knowledge transaction proofs). A number of networks use UTxO or a UTxO extension (such as EUTxO or the cell model). Most famous is Bitcoin but Monero, Litecoin, Cardano, Ergo, Nervos, and a number of other networks also use this model.
This is opposed to Ethereum and co (Polkadot, Solana, Luna...) who use the balance-account accounting model. This model works like traditional ledgers where tokens are stored as some balance in an account and transactions are just transfers from one account to another.