From Deseret News archives:

Is Utah next for a cap on home tax?

Published: Tuesday, Aug. 28, 2007 12:08 a.m. MDT
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Kline, with the California Taxpayers' Association, says Prop. 13 has allowed property-tax revenue for local governments to increase an average of 7.5 percent a year over the past 29 years.

And homeowners get to stay in their homes.

Egbert said her son, who lives in San Diego, owns a $600,000 to $700,000 home and pays $2,000 or so a year in property taxes.

Such stories are common.

But if he were to move to a larger home, which he wants to do, Egbert's son would be handed a $7,000 to $8,000 tax bill for the year.

"I know it has hindered him, and I'm sure it does a lot of people who live there," Egbert said.

Starting off in a new home with such a high tax bill could make such a move cost-prohibitive.

Kline agreed but added that someone who sold a home for $700,000 likely would have enough equity to afford higher taxes.

"We definitely know taxes influence behavior," he said. "It's a factor. It's not the critical factor."

Gerald Prante, an economist with the Tax Foundation, based in Washington, D.C., said people have to remember there's no free lunch.

Residents have to ask themselves, "Are services worth what you're paying?" he said.

"When you restrict local governments, there is more state control over those services," Prante added.

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County governments in Utah are responsible for running sheriffs' offices, operating jails and prosecuting crimes; funding health departments, public works, libraries and animal control; managing land and property documents; appraising property; and collecting taxes.

"People don't want to get rid of it once they have it," Prante said of government services.

People may like a service government provides, but they don't like high property taxes, he added.

Proposition 13 aimed to curb high taxes.

Dan Mitchell, a senior fellow at the Cato Institute, based in Washington, D.C., said, "Whatever the case, there's an argument in making sure you design it (a Utah version of Proposition 13) as well as possible."

Kline said there have been cases where local governments have increased user fees for residents when the government didn't project getting enough revenue from property taxes.

"You have to make sure government doesn't unravel the benefits," Mitchell said.

Ron Mortensen, a Bountiful resident and co-founder of CitizensForTaxFairness.org, said the solution for Utah might be Proposition 13, and it might not be. It could be some variation on the California law.

"We need to look at a Utah solution," he said. "We need to look at what makes sense in Utah."

Recent comments

Attn: Utah Tax Slaves - Do not attempt to pass a Proposition 13 in...

WL | Sept. 19, 2007 at 12:32 p.m.

I built my house 5 years ago for $200,000. I certainly wouldn't...

Casey | Sept. 4, 2007 at 10:21 a.m.

Hey "Cry me a river",

Although you may consider a $600,000 house...

Dave | Aug. 28, 2007 at 4:10 p.m.

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