can someone explain why there is a link between property values and property taxes?

Question

i don't really understand why the two are linked together.

if it costs so much for the county to operate, than just because the value of land goes way up doesn't mean it all of a sudden costs more to operate.

example, running a garbage truck in an area that a house costs 20K. now the houses are worth 40k one day, does that mean it costs more to operate the garbage truck?

i use to live in south florida where the property values and taxes skyrocketed, yet all i heard more and more is how broke the country was. my house payment went from 750 a month to over 1100 a month in less than 3 years, though i wanted to live there, i couldn't afford it.

why do they do that?

i would think they would sit down, see how money is required and then tax from there.

Answer 1

Because the taxes are based on value! Are in fact a percentage of what a property is worth.

Answer 2

Because they can. Once politicians get their grubby wasteful paws on a source of tax revenue, you can only expect it to grow. I live in a small township inside of Lancaster County PA, 5 years ago there was a 1% local tax for all county residences, (not property tax, just 1% income). over the past 3 years, 12 of the 69 municipalities, (the smallest ones), have seen increases totaling 69% and I'm sure there are more coming. I don't have city water, or sewage, I have to pay for a private trash collector, and our township takes care of our roadways. So my extra $$ gets sucked into Lancaster city & nobody gives a flying F about how injust that is.
I'm also a real big fan of tolls, how they where supposed to exist on certain bridges & roadways untill the construction costs where paid. Guess again, 50+ years later, & they have to keep increasing tolls to help pay for upkeep and toll takers cost of living increases & God knows what other BS pet projects.

Answer 3

In Texas, we regularly see property tax rates reduced because the value of property in the community has risen to the total income has gone up under the previous rate. It is the job of the county leaders to adjust the rate and of residents and voters to see that they do or get voted out.
Once upon a time land value increases came close to inflation so that if a house value went up 3% the cost of buying a fire engine and paying the firemen probably went up about 3%. The recent greedy bubble of house values going up 10% or 20% a year while inflation is more like 1% has distorted the relationship of tax income to expenses.
Of course, in south Florida, house payments are also going up because of huge increases in insurance rates to match hurricane losses and rises in value greater than average due to lack of new places.

Answer 4

Their logic is if your home goes up or down in value - the government still needs money - lets say they currently tax your 1,000,000 home two dollars per 100 dollar of value - Your tax bite is $20,000.00. There is a down turn in the economy your house is now worth $800,000.00 but big brother needs $20,000.00 from you, so at $2.50 per $100 of assess evaluation they can still receive their $20,000. Your house is worth less but the value per hundred dollar went up. Your trash collector is still overpaid as well as all your public services. many moons ago the taxman need good help and they competed against private companies. To compete big brother bribed you to work for lower wages by offering great retirement benefits, health benefits etc. Now the public sector jobs went to India & China and we are left with wal-mart who says no benefits, go to your uncle Sam. What big brother gave away - they still do. So public jobs are better than private ones today. Biog brother needs alot money for all these give aways and you pay through the nose - hopefully you don't work at Wal-mart because then you have slim chances of ever paying property taxes.

Answer 5

Property taxes are based on a percentage of accessed property value. So when the value goes up, the tax also rises. That is just the way it works anywhere in the United States.

Answer 6

In the state of Florida if you own a home and it is homesteaded the maximum they can raise your taxable home value is 3% per year. I agree with you that counties were cleaning up big time in the latest real estate boom and for them to whine about being broke told me there was some total incompetent boobs running the budget. I got a brand new stop sign on my street. There was nothing wrong with the old one, it was in perfect condition. There were spending like drunken sailors. Didn't the homestead exception just get raised? Between taxes and insurance the people in Florida are getting killed.

Answer 7

It's supposed to make it fair. Would you want to pay the same amount as the million dollar mansion down the road does? Let's say they said they were going to do a flat tax where everyone pays the same and they needed x amount of dollars to run the county. Well then you pay the same amount as Joe Millionaire does. Can you afford that? What may be chump change to him may break you. So that is the county's way of making fair.

Answer 8

Because those that have the most expensive property receive the most benefits. People that have less expensive property do not benefit as much from the government services as those who have more expensive property.
Perhaps you would prefer an income tax; it would be more equidable and fairer. But the result would be close to the same.

Answer 9

So taxes are assessed by the value of the land. Land value is calculated by the government/market and we live in a land of Supply and Demand...

Answer 10

Remember, in politics, money = power.

It is simply a scheme to raise taxes without a vote. You'd never get people to vote for a 13% per year tax hike year after year.