Wednesday, February 10, 2010

What is a tax increase?

The property tax rate in Utah County in 2008 was .000809, and was increased in 2009 to .000878. In other words, the property tax rate was increased by 8.53% in 2009. I think that is a tax increase. However, my opponent claims it was not a tax increase, because our home values fell by about 8%, so they had to raise the property tax rate by 8.5% to collect the same dollar amount in property taxes in 2009 as they did in 2008.

I would compare this to a farmer deciding to feed his plow horse 8.5% less. But, when the plow horse doesn't have as much strength to pull the plow, the farmer just makes him work an hour longer every day to get just as much work out of him.

Like many of you, I made less money in 2009 than in 2008 due to the recession, and was frankly just grateful for my job in 2009. At my house, we had to cut down on a number of expenses in 2009 due to our lower income. But Utah County didn't have to cut nearly as much as we did, or you most likely did, because they could simply raise the property tax rate to keep their property tax income exactly the same.

In fairness to my opponent, he would tell you that the State of Utah sets Utah County's property tax rates every year by calculating the property tax rate necessary to collect the same dollar amount, while potentially adding a little more for population growth. So, he would tell you that he just approved the amount that the State of Utah sent him. But my opponent had the ability to deny the property tax rate increase recommended by Utah. In other words, he had the ability to prevent it if he had opposed it, and convinced one more Commissioner to oppose it as well.

However, what do you think? Do you think it was appropriate for Utah County to raise the property tax rate 8.5% to collect the same amount of property taxes in 2009 as they did in 2008?