|
A tax reform package signed by Gov. Mitch Daniels lowers
property taxes and caps future increases. In exchange for the
property tax cut, sales taxes went up.
Under
House Enrolled Act 1001, sales taxes increased from 6% to 7%
and tax caps, sometimes called circuit breakers, will be phased
in for all property owners.
Not Everyone
Benefits
The circuit breaker protection doesn’t benefit
all taxpayers equally. Homeowners will ultimately pay no more
than 1% of their assessed value in property taxes, while
business property owners will pay 3%. (See table.)
There are also variables within the same
property class. If commercial properties currently pay tax that
is less than 3% of the assessed value, there will be no
additional relief afforded.
No figures have been released on how many
commercial properties will benefit from the circuit breaker
statewide. However, a random study conducted by The Chesterton
Tribune may shed some light on what business owners can expect.
The Tribune looked at 110 residential properties
in Porter County and found 60% currently pay more than 1% of
their assessed value in property taxes but 40% do not. While
it’s impossible to know what the tax rates and other components
of tax bills will be in 2010, it’s probable that businesses and
homeowners who don’t qualify for the circuit breaker cap now
won’t qualify for it in two years either.
For 2009, significantly fewer properties will
benefit. Of the 110 homesteads in the newspaper’s search, only
4.5% currently pay more than 1.5% of their assessed value in
property taxes. Just over 95% do not and will therefore not
qualify for the tax cap next year.
More Votes
Required to Change the Constitution
A constitutional amendment to permanently place
the tax caps into the state constitution must still be adopted
by the legislature that is elected this fall. It must then be
approved by voters in the 2010 general election.
|
