The General Assembly passed the tax restructuring bill. It increases sales taxes and will likely have the effect of increasing local option income taxes in return for a reduction in property taxes. The sales tax will increase 16.6% (from $0.06 per dollar to $0.07 per dollar). Property taxes will be capped at 1% of the property’s value for owner-occupied residential property; 2% for rental properties; and 3% for business properties. Funding for schools and local government will likely be decreased to a level that forces those entities to pass local option income taxes.
So… talk to me about Homestead Credits… they are raising them as part of all this (seems like I read 45% somewhere, but I can’t find it now). As far as I can tell, there is nothing anywhere that says what the homestad credit is going to be from one year to the next. With the different rates for owner-occupied and rental properties, why do we even still have the homestead credit? And is this a 45% that they can then choose to take away (whereby increasing property taxes by up to 45%)?