The Importance Of Property Taxes To States And Local Government

Property tax is the “most common,” “most dependable and stable income base,” for schools. Property tax can be a complicated process and there are difficulties for taxpayers because assessments can be overvalued or undervalued. A property may be worth less and yet the property tax may be higher than the assessed value of that property. This over and under valuing can be frustrating to a taxpayer that lives in a home that they can’t sell for the million dollars that their home’s property tax is assessed at and yet they are paying property taxes for a million dollar home. I would think that in areas where there is less property to be taxed, there would be less income coming in to those school districts, making it less equitable. It could be vastly different from one area to another.

Property tax is a charge on property that the owner is responsible for paying. The tax is constructed on the value of the property one owns and is often estimated by local or municipal governments. When paying a property tax bill, the money goes to a number of important programs, city employees, police officers, firefighters, and public works departments also receive pay. The property tax money is used to pay for parks, traffic construction, street lights, sidewalks, and public transportation. Imposing a cap on property taxes would not only impact communities but it will also create several major problems. Cities would be affected and unable to hire employees in the public safety, since salaries and other benefits would be increased. A cap would reduce job establishment and damage the state's economic growth. The cap would also create more traffic problems by limiting

As seen in Chapter 15 of Real Estate Principles by Charles J. Jacobus, property tax is a large source of income for local governments. When property taxes are not paid, a lien is placed on the property. If property taxes are not paid, this gives the government the right to seize the property. This is currently happening to Bill Davies, a developer from Chicago, Illinois.

"In 2004, property tax collections in the U.S. exceeded $300 billion. Property taxes are responsible for approximately 72% of all local tax revenues, representing the most important tax revenue source for local governments" (as cited in Shan, 2010, p.195).

The main difference between the federal budget and the state and local budgets is the issue of a monetary deficit, in which expenditures in the budget exceeds revenues that were estimated. State and local governments are required to balance their budgets. The federal government is allowed to borrow money to meet its obligations and have a deficit. The federal government collects the most tax revenue, but state and local governments have a greater range of revenue options for funding their budgets. The federal government relies mainly on income taxes, capital gains and Social Security taxes. State and local governments collect sales taxes, taxes on fuel, property taxes and fees from special licenses and permits. Also, many state and local

Property taxes in California have been a controversial issue for very many years. In mid 1978, approximately ⅔ of voters in California passed proposition 13. Before it had been passed, property taxes increased almost annually according to the assessed value of the property. In the 1970s, there was a remarkable growth in the real estate market and the value of homes rapidly went up. Property values were escalating substantially since assessors had to keep assessed values current. On the other hand, increments in the evaluated value were not made annually. Therefore, this led to a huge tax shock for homeowners after every few years.

The federal government puts tax on everything, this allows them to take a percentage of our money away from us and use it for the country. Right now the US in debt and can’t afford to run this country alone. They use our money for several things everyday. However, there are limits to what the can tax such as; they can not tax Church services because it goes against our first ammendment right.

Mandira Pandey Professor Sherifian GOVT 2306-73004 1 May 2017 Local control in Texas The government of Texas is composed of entire democratic state government which uses municipal levels and dillion rule. It works beneath the constitution of Texas. The government of Texas is divided into three branches i.e. 1 executive legislative and judiciary. Executive for carrying out laws. Whereas, legislative for making laws. Likewise, judiciary branch aims for interpreting laws.

The state of Texas receives the majority of funding from two sources; taxes and federal receipts. “Currently, Texas is one of nine states that does not levy a personal income tax on its residents and, in addition, its property tax system is a function of local governments. This makes Texas somewhat unique, in that, its state government largely relies on revenue generated from sales taxes and a business tax.” (Texas Public Policy Foundation, 2012) For

While there are advantages to the mandate, such as protection for the taxpayer and an assurance that property tax relief is felt by all property tax payers, many are wary that the limits now could lead to higher property taxes in the future (Minnesota Office of the Legislative Auditor, 2000).

23). One major difficulty with property tax is the valuation process itself. Sorenson and Goldsmith list homestead exemptions, tax abatements, legal entanglements, taxpayer associations and underassessments as reasons that taxes are not based on the full property value (p.23). In terms of school funding, schools in wealthier communities are at an advantage over schools in economically depressed areas, where property values are much lower.

First of all, Property Taxes, Revenues and Interests are worth-based taxes paid on various types of property (e.g. residential and commercial real estate, motor vehicles, farm machinery, etc.). The body charged with tax collection is responsible for taxing authority appraises the

Furthermore, according to our current tax code, investors pay significantly lower tax rates than normal workers. Those who invest in the Social Security, Medicare, or FUTA always receive investment payout. Moreover, “Long-term capital gains have been taxed at an ever lower rate, and investors in the lowest tax bracket have had a 0% rate on their long-term gains for the past few years” (Cussen, Para. 3). This goes to show that many investors are using loopholes in the tax code to pay significantly less tax than they owe to the government. A municipal bond, according to Cussen (2012), “is a debt security issued by a state, municipality or county to finance its capital expenditures, including the construction of highways, bridges or schools. Municipal bonds are exempt from federal taxes and from most state and local taxes, making them especially attractive to people in high income tax brackets.” For this particular reason, smart and greedy investors are thus overtly attracted to municipal bonds because it’s pure profit with a 0% tax rate.

Cory Turner of National Public Radio, writer of Why America’s Schools Have A Money Problem, has the answer; “…45 percent local money, 45 percent from the state and 10 percent federal…why is it that one Chicago-area district has $9,794 to spend on each of its students, while another, nearby district has three times that? Two words: property tax,” (Turner 2). The authors of Equity Is the Key to Better School Funding, Marin Gjaja, J. Puckett, and Matt Ryder, say, “Giving kids in high-poverty areas an equal opportunity to succeed requires spending more money on those students,” suggesting that in those low-income areas, local and state government regulations alone and predominately will not be beneficial (Gjaja, Puckett, and Ryder 1). Property taxes when associated with funding for education are insufficient in low income areas, and in return are insufficient for the school. Leaving local and state governments with the responsibility of fulfilling a majority of education costs is a concept we should correct. Turner also mentions that one Arizona school has four-day weeks to save money from electricity bills, as a result of poor rates of property taxes. Budget cuts also contribute to the impairment of districts with lower property taxes and lower income families, an implied point from Michael Leachman’s article, Most States have Cut School Funding, and Some

Sales and tax rates are stable in some states, but tend to be unpredictable in others. Counties, cities, school districts, and townships are continually expanded, becoming established and given effect in the United States. In some locations, sales and use tax rates are even more susceptible to change because of political influence, this can cause rates to even change as recurrently as a monthly