Monday, March 10, 2008
Graphic Language about Property Taxes
In its March 9 Forum section, the Post Gazette (PG) ran a graph displaying median property taxes paid as a percentage of median property value for the Pittsburgh region compared to 39 other regions around the country. Pittsburgh ranked 6th highest on the list with a ratio of 1.7 percent. The Pittsburgh region is defined for the comparison study as an 18 county area including counties from southwestern Pennsylvania as well as West Virginia and Ohio.
Including 11 more counties with the Pittsburgh MSA obviously dilutes and disguises the hefty burden of property taxes in Allegheny County. Indeed, many counties in the Pittsburgh MSA have far lower combined school, county and municipal taxes than Allegheny County.
What is interesting about the tax burden comparison is the collection of regions ranking highest and those ranking lowest. The four highest tax burden regions according to the PG graph are in Texas. This might be a surprise until one realizes that there is no income tax in Texas making that state’s local governments more dependent on property taxes. In Pennsylvania, municipalities and schools can impose property taxes and earned income taxes (Allegheny County has a sales tax as well as a drink and car rental tax). Municipalities can also levy a parking tax, business privilege tax, and a $52 municipal service tax. In short, southwestern Pennsylvania local tax burdens are far higher than just property taxes, which are plenty high.
Meanwhile, seven of the lowest property tax burden regions according to the PG’s graph are in California where property tax increases are limited by Proposition 13. Median property taxes as a percentage of median property value in those regions were barely above 0.5 percent compared to Pittsburgh’s 1.7 percent Also counted among the lowest ten tax burdens was Denver, Colorado. No surprise there in light of the fact that the state enacted a Taxpayer Bill of Rights in 1992. The law requires a voter referendum for any tax rate increase at all levels of government.
Obviously, there is a message here. The Pittsburgh region—especially Allegheny County— despite having a menu of taxes, still takes a significant bite out of the homeowner. Without taxpayer say over tax hikes, the bite will almost certainly get worse. Playing games with the assessments in Allegheny County will not solve the problem.
Including 11 more counties with the Pittsburgh MSA obviously dilutes and disguises the hefty burden of property taxes in Allegheny County. Indeed, many counties in the Pittsburgh MSA have far lower combined school, county and municipal taxes than Allegheny County.
What is interesting about the tax burden comparison is the collection of regions ranking highest and those ranking lowest. The four highest tax burden regions according to the PG graph are in Texas. This might be a surprise until one realizes that there is no income tax in Texas making that state’s local governments more dependent on property taxes. In Pennsylvania, municipalities and schools can impose property taxes and earned income taxes (Allegheny County has a sales tax as well as a drink and car rental tax). Municipalities can also levy a parking tax, business privilege tax, and a $52 municipal service tax. In short, southwestern Pennsylvania local tax burdens are far higher than just property taxes, which are plenty high.
Meanwhile, seven of the lowest property tax burden regions according to the PG’s graph are in California where property tax increases are limited by Proposition 13. Median property taxes as a percentage of median property value in those regions were barely above 0.5 percent compared to Pittsburgh’s 1.7 percent Also counted among the lowest ten tax burdens was Denver, Colorado. No surprise there in light of the fact that the state enacted a Taxpayer Bill of Rights in 1992. The law requires a voter referendum for any tax rate increase at all levels of government.
Obviously, there is a message here. The Pittsburgh region—especially Allegheny County— despite having a menu of taxes, still takes a significant bite out of the homeowner. Without taxpayer say over tax hikes, the bite will almost certainly get worse. Playing games with the assessments in Allegheny County will not solve the problem.
