12/21/2009
by Gary Truitt
With the Indiana General Assembly about to begin considering making property tax caps part of the state constitution, evidence is surfacing that the caps may not be working as first intended. For the past two years, Indiana Farm Bureau has maintained that property tax caps should not be made permanent until we know if they really work to limit increases in taxes. Katrina Hall, tax specialist with IFB, says evidence is surfacing that the caps are not having their desired effect, “In many places there has been dramatic increases in assessed valuation; and so legislators are beginning to see the caps are not working as they had hoped.” While the legislation to make the caps part of the state constitution continues to move forward, Hall says some lawmakers are beginning to question if this is good policy.
In the past few weeks several studies have been released by Legislative Services that indicate how much tax relief different classes of property are actually receiving. She said the data shows that farmland is getting very little relief but it also showed that homeowners are not getting as much relief as lawmakers had anticipated. “In 2011, circuit breakers are only expected to account for 1% of a farmer’s tax bill,” Hall told HAT. Homeowners and other classes of property get far more relief. In addition much of a farmer’s property, his buildings, and equipment are taxed as the 3% level.
Some lawmakers want to adjust the formula by which land is assessed, but Hall said this will not solve the problem of tax caps being unfair, “Even with a change in the formula, a homeowner’s bill will still be half as much as a farmer’s when homeowners use most of the services the tax dollars pay for.” Hall is hopeful these developments will slow the headlong rush to put the tax caps into the constitution.
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Additional resources are available atwww.indianataxequity.org
Listen to the entire interview with Katrina Hall at
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