12.01.06
The Latest Tax Scam - Appraisal Caps
Appraisal caps won’t fix what’s wrong with taxes in Texas either. It’s a shell game, a tax shift again, onto those who can afford it least. If you take money out, it has to be replaced, it’s simple math. Texas has been trying for years to figure out this puzzle without an income tax and this kind of stuff will continue, I’m convinced, until we have one.
In the upcoming session appraisal caps appear to be the latest rage to solve the tax burden on homeowners. Well if you read a recent story from the HChron, like with most tax issues, it’s the middle class and poor that are over taxed and the rich that aren’t paying their fair share. This post was sparked by an article today about home appraisers wanting disclosure of sales prices of homes to be made public so they can do their job better. They purport that $4 billion has been left out of the state budget because of low property evaluations, mainly on commercial and multi-family property.
Property appraisals in Texas are a system to be gamed. The only thing is, that to game the system you need money, aka a lawyer. Which most owners of commercial and multi-family property have.
The study by officials with the Texas Association of Appraisal Districts found that lack of such information has caused appraisers in urban areas to undervalue commercial property by an average of 40 percent and residential property by 15 percent.
Multifamily property is undervalued by 25 percent.
Notice that residential property - homeowners, you and me - are the one’s getting the shaft here. Let’s say I own a bunch of commercial property, apartments, etc. I have a team of lawyers and I can go to the county appraiser and challenge. This Allows me to get a lower valuation and pay less taxes. As opposed to Joe Citizen who has one house, two jobs, can’t afford a lawyer and just pays his taxes as part of his mortgage.
Mr. Amezquita also said commercial and multifamily building owners – many of them out-of-state investment trusts – are far more likely to take an appraisal district to court over tax roll values. He noted that of 500 lawsuits he is facing in the San Antonio area, nearly all involve commercial property.
Here are two questions:
How much could you home sell for today?
How much money did you make this year?
Which one can you answer more definitively, right now? The point of all of this is that our schools are underfunded and the tax burden in the state of Texas falls unfairly on the poor and middle class. A progressive state income tax would solve this problem. Who truly knows what your house is worth at any given time? Everyone knows how much money they made last year.
The point of taxes should be to spread the burden equally among all levels of wealth, the broader the tax base allows the lower the rates. (I personally believe that to whom much is given much is expected). Having a progressive state income tax (with rates between 3.50% and 6.45%), and then being able to cut property taxes by 80%, wold be a much better and fairer way to fund public education and our state government.
Nothing will take the burden off the homeowner, property owner - commercial or multi-family - or the poor and the middle class, in a way that is fair for all, better than a progressive state income tax.