Any problems with the property tax system in Utah as pointed out by a recent Utah Supreme Court ruling should be solved within the same system so the tax burden isn't shifted elsewhere, according to a resolution adopted by the board of governors of the Salt Lake Area Chamber of Commerce.
In an effort to maintain the current property tax system, the resolution recommends the Legislature provide for assessment of all properties at 100 percent of market value and then apply constitutionally allowed exemptions as appropriate.To that end, the board recommends the residential exemption be increased from 25 percent to a range of 30-35 percent with a preference at 30 or 31 percent "to minimize the impact on locally assessed properties and to equitably share the burdens of the property tax shifts," the resolution said.
Presenting the resolution to the board was David Bird, chairman of the chamber's State Legislative Action Committee, who said the issue was raised several months ago when the high court ruled that Amax Magnesium Corp. had been unfairly treated because it didn't receive a 20 percent tangible deduction on property taxes.
The result is that Amax, and possibly other centrally assessed properties as well as owners of personal property, may receive a tax refund, the resolution said. "The Amax court decision clearly indicates Utah property tax laws must be changed to eliminate discrimination among the various categories or property," it said.
If all properties are assessed at 100 percent of fair market value, the bases of all taxing entities will increase, and no taxing entity need experience a revenue shortfall, Bird said. That means the Legislature doesn't need to look outside the property tax system for other sources of revenue to offset any shortfall.
Bird presented some charts attempting to show how property taxes would change if homeowners were given an exemption of between 30 and 35 percent. There would be significant property tax increases to some, decreases to others, but the overall statewide impact would be negligible, he said.
Although board member Anthony L. Rampton said residences are undertaxed and should be given an exemption of between 25 and 30 percent, he voted for the resolution.