While property taxes account for about one-fourth of all the tax revenue collected by state and local governments in Utah, the burden of property taxes in the state is relatively low — 34th in the nation. Those are among the conclusions of a new Utah Foundation research report, The Essential Tax: Property Taxation in Utah.
The key findings of the report include:
• Utah’s property tax burden ranks 34th among states. The tax burden has been stable over time, both in terms of income and its ranking among states.
• Utah’s Truth in Taxation law appears to have prevented property tax revenues from increasing as quickly as property values.
• Revenues for school districts and special and local districts statewide have increased faster than inflation and population growth combined. By contrast, cities and towns have only been able to match population growth and inflation while county revenues have grown even more slowly.
• Residential property has a much more favorable tax status than business properties. Not only do residential homes receive a 45% discount, but residential taxpayers are also exempted from personal property taxes.
• Residential properties still provide nearly half of all property tax revenues.
• More than half of all property tax revenues go toward public schools.
“Growth in property tax collections has favored some entities, such as school districts and special service districts, with revenue growth keeping up with or even exceeding inflation. Cities and counties, on the other hand, haven’t seen their revenue grow as quickly,” explained Utah Foundation Research Analyst Christopher Collard, the lead author of the report. “Many cities haven’t held a Truth in Taxation hearing for years, and some have never done it.”
The Essential Tax: Property Taxation in Utah is available at www.utahfoundation.org.