NEWS
BYTES
November 1999
Editor:
Scott Gottlieb, CPA
Assistant editor: Susan A. Maffetone, CPA
This
article is a press release from the Tax
Foundation
Property
Tax Collections Reach New Heights at State and Local Levels
Washington,
D.C. October 29, 1999 - According to estimates in a new
Tax Foundation Special Report, property tax collections will
hit an all-time high in 1999.
Local
government units including counties, cities, and school districts
will collect approximately $221 billion, while state governments
collect $11 billion.
The
study is "State and Local Property Tax Collections," by economist
J. Scott Moody.
Adjusted
for inflation, property tax collections have risen steadily
since 1950 except during a series of tax revolts in the 1970s
made famous by California s Proposition 13. The decline bottomed
out in 1981, and property tax collections have grown 69 percent
since then.
Local
vs. State Property Taxes
In
FY 1996, the latest data available, 73 percent of all local
tax collections came from property taxes. Coming in a distant
second was sales tax revenue (16 percent) followed by income
taxes (6 percent).
Table
1 shows local property tax collections by state and ranks
those collections on a per capita and per $1,000 of personal
income basis. New Jersey localities collected the most per capita
($1,606). Following New Jersey are New Hampshire ($1,531) and
Connecticut ($1,425).
In
terms of personal income, New Hampshire localities top the list
with $59 collected for every $1,000 of personal income. Following
New Hampshire are New Jersey ($53) and Vermont ($53).
State-level
property taxes are small compared to local collections, and
they account for only 2 percent of state revenue. However, they
have begun growing more rapidly.
Table
2 shows state property tax collections by state and ranks
those collections per capita and per $1,000 of personal income.
In per capita terms, six states collect more than $100 in property
taxes. By far the largest is Washington with per capita property
tax collections of $329. The five next highest states are Montana
($263); Wyoming ($174); Michigan ($169); California ($106);
and Kentucky ($106). As a percentage of personal income, only
two states collect more than $10 per $1000 of personal income:
Montana ($14) and Washington ($14).
The
report includes discussions of property tax administration and
the process of determining who ultimately bears the tax burden
of property taxes.
The
Tax Foundation is a nonpartisan, nonprofit organization that
has monitored fiscal policy at the federal, state and local
levels since 1937.
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