Is it economically viable to replace property taxes and consumption
taxes with local income taxes?
Usually, but not necessary always.
Many local governments impose income taxes. New York City is one well known example.
The marginal compliance cost of a local income tax in a place that has a higher level of government that also imposes an income tax is very modest. Most U.S. states with an income tax use federal income taxes as a starting point and then tweak the calculation to limit the tax to only income within the locality's jurisdiction.
All one has to do is determine the amount of revenue raised by the taxes replaced and adjust the income tax rate to cover it.
The only exception would be in local government jurisdictions in which there is not enough taxable income to support the needs of the government in question (a probably that can also arise in the case of property taxes and consumption taxes).
For example, if you have a county government that is almost entirely comprised of land owned by tax exempt governmental and non-profit entities that don't use that land for income producing purposes, have no commerce to produce sales, and are also exempt from property taxes, financing that government can be a problem.
This isn't a hypothetical problem. It comes up with some frequency in the arid west where there are huge tracts of thinly arid and mountainous land owned by the federal government, or religious institutions, or other non-profits such as universities. It also comes up, for example, in cemetery districts, whose deceased residents have no income even if that income would be taxable.
These governments have to find other sources of revenue.
Cemetery districts, for example, typically generate income from the purchase of burial rights that are used to endow the governmental entity and pay its expenses in perpetuity. In Japan, cemeteries charge rent to the next of kin for the burial sites and dispose of the remains when people stop paying rent to make room for new spots.
Non-taxable governments or non-profits often make voluntary contributions in lieu of taxes to the local governments they are located in, in order to allow those governments to provide services that benefit the voluntary contributor for the most part.
What are the downsides of such a proposal?
One basic problem is that the amount of money that a local government needs to provide the services that it is mandated to provide based upon need in its jurisdiction doesn't necessarily correspond the the income that is earned within its jurisdiction.
For example, residential neighborhoods with lots of poor people in them (e.g. mobile home parks) have a high demand for local government services and a low amount of taxable income.
In contrast, an industrial park that is all part of business property owner's association that is home to lots of tech companies may have immense income and very modest needs for governmental services.
One reason that local governments have different tax structures is to reflect their different mix of service demands and taxable sources of revenue.
Another difficulty with local income taxes is that localizing where income is earned is frequently difficult and presents a serious opportunity for evasion by simply relocating "hot income" like returns on intangible assets like interest bearing accounts and stock dividends.
A third difficulty with local income taxes is that enforcing payment is often challenging. For example, shortly before its financial meltdown Greek tax collection rates, which had a large income tax component were very low, on the order of 10%. This is also a difficulty in economies (like much of the third world) where lots of participants in the economy do not maintain auditable books or use banks, such as subsistence farming economies.
In contrast, businesses upon which consumption taxes are imposed often have a physical presence in the local jurisdiction that can be shut down if the business does not account properly and pay taxes.
Property taxes are typically administered by the local government which values the property and sends invoices to the taxpayer who only needs to pay the bill. And, if the taxpayer doesn't pay, the local government takes a lien against the property which isn't moveable, and seizes to property to pay the much less valuable tax debt owed if the taxpayer does not. Sometimes, the process is further streamlined, with the tax liens sold to private investors who then handle collection of unpaid taxes privately, with interest, while the government receives income promptly from the investors. Then, the investors get the windfall in the rare cases where the liens advance to a foreclosure sale.
Also, if property taxes have some sort of homestead exemption they are only moderately less progressive than a flat income tax.