Is Michael J. New guilty of stupidity or mendacity?
Proposition 13 limited property taxes in California to one percent of assessed value and placed tight limits on how quickly assessments could increase. Overall, Proposition 13 triggered an immediate property tax reduction of $6 billion and to this day provides homeowners in California some much needed tax relief … The passage of Proposition 13 was clearly a substantial victory for taxpayers.
Someone who purchased a house in 1976 and still lives there is certainly getting a low effective property tax rate. But newcomers are stuck with effective tax rates equal to this 1 percent. Suppose you are about to bid $500,000 for a house that the current owner purchased back in 1976. His Prop 13 appraisal is likely only $100,000 so he’s paying only $1000 a year in property taxes. But you’ll pay the full $5000 a year. So to suggest all homeowners get “needed tax relief” suggests that Mr. New either does not understand California’s property tax regime or he is not very honest.
To say that this chaotic aspect of California’s tax laws is providing relief in general for taxpayers shows Mr. New does not comprehend the California fiscal situation. California has made up for the loss in property tax revenues by having high tax rates elsewhere. And yet the state has a long-term fiscal shortfall. Why? That brain dead provision imposed by Prop 13 as to what it would take for Sacramento to change California’s tax laws.