PROPERTY TAX – TAX ON PERSONAL PROPERTY
Property tax is a levy that is issued by the government on a person’s real or personal property. The property which is assessed to give it a value, and then that value is taxed. The quantity of property tax payable can be determined by multiplying the market value of that property by the current tax rate.
POSITIVE APPROACH TO PROPERTY TAX:
- Property tax has the benefit of being managerially and technically maintained or commenced with ease.
- It can be administered cost effectively, and it is likely to aspire for a cost yield ratio of at least 2% or less.
- It is very difficult to shun or elude, and collection rates can be achieved to as high as 90%.
- It is translucent or transparent.
- The public are aware of the perception of market value (be it capital or rental) and consequently are pleased with the source of assessment.
- In general there is a good association between assessed value and the capability to pay.
- The profits are conventional and optimistic.
PROPERTY TAX – Public Perception :
- Property taxes are less popular and not perfect. Although it is essential to keep in mind that no taxes are perfect.
- Transparency of such taxes reveal inconsistencies which may at any point of time be magnified in front of the general public. These inconsistencies may occur due to both assessment and inability to pay.
- A problem of “buoyancy” would also appear which basically function on two mechanisms – Initially, the revaluation of properties at regular intervals and increase in the rate of tax in order to produce the required and desired revenue.
- Although the public understands the concept of assessment, confusion often arises between the ‘ratable value’ and setting the ‘rate’.
WORKING OF PROPERTY TAX :
Property tax is calculated based on the overall value of one’s property. The whole property value is multiplied by the mill rate of the property on the basis of the location that it is located. A mill is calculated as .001 % of a standard unit of currency. Depending on the location mill rate would vary. The resulting value is then divided by 1,000 in order to calculate the final amount one has to pay as his tax.
PROPERTY TAX – Funding for Public Expenditure :
Property tax is widely used for the support of the city and country project. It is used for the improvement of one’s state or city by the government. For this purpose, a percentage of one’s property – real or personal – is taxed which are use for many public purposes such as for school education systems, welfare of the people or health programs. Property tax is collected by several local governments within any state. They are used to pay services like fire and security, local infrastructure like airways, highways, police and other welfare systems. In most states, a majority of the property tax collected are handed over to the public schools. Generally, it is a method to help our community by the government.
