Yes, property tax is a tax on capital.
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For perspective, compare the tax rate on real property as a % of the the capitalization rate (expected profit from rent if the property were owned free and clear). So if your property tax is 1.25% and the capitalization rate in your city is 5%, the tax is equal to 25% of the cap rate.
I guess for the numbers in the example I gave, the cap rate without tax would 6.25%, so really the tax is 20% of the tax-free cap rate. To me it seems sort of in the ballpark of other income-related taxes, such dividend tax and tax on ordinary income. Just a thought.
PS. So if a wealth tax were added to the system with no other changes, it might dramatically increase the real rate of tax on... well, on real property.
Income from real property is also taxed as income, though sheltered by deduction. So under a regime that adds a wealth tax to the existing tax system, a real estate investor might be subject to 3 types of tax due to owning one property.