Friday, March 12, 2010

High Property Taxes?

I read an article which had a summary of high property taxes on Forbes entitled "Where Americans Pay Most in Property Taxes" with a subtitle "A national look at the county-level costs levied by Uncle Sam." I thought the title and subtitle were both misleading. While I think the title is technically correct, it is misleading because it is based on taxes paid rather then the percentage of tax compared to the home value. So it is skewed towards counties where the value of the homes is high. So for example all the counties they highlighted in the "West" where in California (mostly in the Bay Area) where home values are very high, but then when I did a quick calculation I saw that the percentage based on the value of the home was relatively low (0.5% when as a rule of thumb it is usually around 1% in Seattle: approximately double). Do not get me wrong I think California pays a lot of tax: they have a high income tax and sales tax, but the point being the houses in those counties are worth a lot, thus they pay more property taxes.

As for the subtitle, I always thought Uncle Sam represented the federal government. Property taxes are levied by local governments; therefore, I do not think Uncle Sam has much to do with it.


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