The Courier Journal calls it a “tax relief” plan, but The Daniels Plan – call it restructuring, tax shifting, relief for some – higher taxes for others – but come on, simply “relief” or “reform” belongs in the editorial pages, not the news pages. Once again, that’s not to necessarily criticize the plan, but the language used in straight news needs to recognize that it’s relief or reform for some, and simply higher taxes for others to whom taxes shift. All right, off of this particular tedious soap box.
HB 1001 was passed unanimously without debate or amendment. Rep. Crawford who chairs the committee said it ought to be considered by the full House, but that moving it along ought not be considered an endorsement, necessarily. The House is scheduled to hear amendments to the bill on Tuesday. Rep. Terry Goodin suggested that upwards of 150 amendments were being drafted for consideration on Tuesday. (Lucky for those poor folks at Legislative Services who have to draft the things.)
The Daniels plan calls for disparate caps on property depending on its use – a 1% cap for homesteads, a 2% cap for rentals, and a 3% cap for business property. The caps would force any necessary tax revenues to come from other kinds of taxes or, alternatively, cut funding for cities, counties, and schools.
Niki Kelly also has a story on the bill. So does Bill Ruthart. Ruthart points out that the property taxes will be made up by a shift to sales taxes. The sales tax would increase from 6 cents on the dollar to 7 cents on the dollar, a sales tax increase of 16%.
Doug this is tax shifting at it’s best. Limiting a $300,000 home to $3,000 come on. Especially in the areas where they want the Olympic Size pools in all the schools.
I live in White county where I believe the trending and assessments where fair, I am paying 1% as it is. And I do not see it going up. But now I have to pay my full property tax bill and 1% Sales Tax.
They are shifting taxes to the poor and rural areas of the state.
Ok, am I missing something? (Quite possible, I did this in a hurry)
What percentage are businesses now paying? It looks like this will be balance on their backs.
Comparing the 2% circuit breaker previously passed vs. the 1% current proposal is the difference of $500 a year for me (modest $50,000 home in Marion County).
For a 1 cent sales tax increase to cost more than the $500 change in property tax for me, I would have to spend $50,000 a year in “stuff” (remember, services such as electricity, gas, phone, home and health insurance, etc. aren’t taxed – neither is basic food at the grocery).
Trust me, after all those bills, I don’t have even close to $50,000 to spend.
In reality, my taxes went up to $850, not $1000 – a difference of $350 from the 1% – but I don’t have $35,000 to spend on “stuff” either, so still ahead of the game.
It actually gets more offset for the guy with the $300,000 home. Say he was paying $6,000 with the 2% circuit breaker and is now paying $3,000. He would have to spend $300,000 A YEAR on “stuff” to make up the difference…???
Unless the number of people paying around 1% now is really, really high, or businesses are made to bleed, I don’t see how this can balance.
Anyone else run their particular numbers?
Brenda, it doesn’t balance. Mitch has said so.
It is 2002 all over again. How did raising the sales tax from 5% to 6% lower your property taxes? It didn’t.
BTW, here in Lake County, we got the 2% tax cap this year. Saved me $500. I think 2% in property taxes is more than fair. 1% is too low, especially if it is paid for with more sales tax.