Soaring property values in recent years swelled the coffers of counties and municipalities, raising calls for property-tax cuts. Now, even as foreclosures and dwindling home sales shrink local tax bases, a number of state governments are slashing or capping property-tax rates....
But many of these property-tax initiatives, while politically popular, mask a hidden truth: They are likely to lead to increases in other kinds of taxes.
So-called "swaps," under which property taxes are cut and made up for by levies elsewhere, have been popular in statehouses.... But even when states don't make such deals outright, they may in the long run resort to tax increases to plug revenue holes.
The national movement against property taxes dates to the 1970s. But the most recent real-estate bubble has given it more potency in certain regions of the country, like the New York City suburbs.
Wednesday, June 11, 2008
Some States Cutting Property Taxes
The Wall Street Journal reports: