(Indianapolis, Ind.) – Thanks largely to the caps on Indiana property taxes, Hoosiers paid 32 percent less in taxes in 2011 than in 2010.
The Indiana Department of Local Government Finance says those caps enacted in recent years thanks to a new state constitutional amendment have cut $566 million from tax bills. The figure is down $136 million from 2010.
Because of the new caps, the most residential property can be taxed is at one percent of assessed value. Farmland is capped at two percent and business is at three.
“Taxpayers at the 1% cap received direct tax relief of $164.2 million, while those at the 2% cap received $243.5 million, and those at the 3% cap received $154.0 million,” the DLGF said in it’s August 5 report.
Property taxes are the main funding mechanism for schools and local governments. With less revenue coming in, those entities are feeling the pinch. The state reports school districts have seen annual revenues decline by $200 million while local governments receive $192 million less.
Another reason cited for the property tax savings is a decreased in the assessed value of properties, going from $266 billion in 2010 to $262 billion in 2011.
The DLGF report, including local figures, can be found at http://www.in.gov/dlgf/files/110805-_Impact_of_the_Property_Tax_Caps.pdf.