The property was purchased with "after tax" money. So at purchase date the value was already taxed.
If one sells, and make a profit, we tax that profit. Why ask for a tax on the value of the property, each year.
There should be local taxes, and there are. To fund services and whatnot of course. But taxing a percent of the current value of a property is unfair as the owner may live in there with no intention to sell and potentially no revenue whatsoever.
Everything is unfair. The housing crisis is unfair. Young families struggling to afford a family home is unfair. Having to pay into a pension system you'll never get to use is unfair. Land and housing is different from personal property. There's only so much to go around and we'll have to share. A property tax is one tool to incentivize efficient allocation, and to drive prices down.
The concept of taxing what's already taxed has some perverse effects.
I concede though that property tax in the U.S is just a way for local authorities to be able to fund schools, and other municipal infrastructure. It remains odd though that most countries do have local taxes, but summing to a fraction of what a ~1% tax every year may represent. As it's a small percentage but on the most valuable and critical asset one may have sacrificed during his life, to own a roof as primary residence.
A fair system is to allow an exemption up to the value of a modest home in the area. So anyone owning a modest home (or less) pays no property tax, which is far to the poor. And those who can afford homes many multiples higher in cost, pay increasing taxes on the difference.
And one value of property taxes (one that is dysfunctional on empty lots) is that it encourages "maximum" use of high value property (lots of bad particulars here, but the overall direction is about right). While we may dislike an elderly person being effectively forced out of the home they have lived in for decades, it is usually for more "productive" uses (for the market definition of productive).
As an example my in-laws have three properties in Hungary that are empty, and have been for quite a few years. Cumulatively they get something like ten weeks of use in a year. But since Hungary does not have property taxes there is almost no incentive to make better use of these properties (yes, they could rent them out for an advantage, but there is no disadvantage pushing them to sell).
It is a problem though, I doubt a property tax is a solution, the proof is, it doesn't solve it.
I wouldn't be against taxing owners on their income, including dividends. To fund municipalities.
My argument isn't that taxes are bad. Public services need funding. Rather, that certain taxes are absurd.
If anything, this particular tax serves one thing that the working class on rental denounces: prime real estate neighborhoods typically are better policed, have better schools, and better infrastructure than what we call "poorer" area.
Edit: I don't imply it is due solely to this tax, but the concept of taxing properties imo makes redistributions naturally or cynically more localized to areas where more gets collected.
The value of that land relies on all of the ongoing services provided around the land. Go look at the value and taxes on land that has zero services (no road, power, water, sewage, maintenance, etc...) and you'll understand the difference.