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In a significant policy shift, there is a proposal on the table that could lead to a substantial increase in property taxes, potentially tripling the current rates. Currently, there’s a safeguard limiting annual property tax hikes to 1%. However, if this proposal becomes law, property taxes could escalate by 1% plus changes in population and consumer prices, reaching a maximum annual increase of 3%. The Consumer Price Index (CPI) for the Western region is a key factor, calculated as of July 25th each year. The Department of Revenue must communicate these limiting factors to the County Assessor by September 1st annually. This proposed tax hike is set to take effect in 2025 and beyond.
SB 6136: Raising property taxes, potentially tripling the current amount you pay
Right now, there’s a rule that limits property tax increases to 1% each year. However, if this bill is approved, property taxes could go up by 1% plus any changes in population and consumer prices (CPI), with a maximum annual increase of 3%. The CPI is determined based on the Consumer Price Index for the Western region as of July 25th every year.
The Department of Revenue must provide the County Assessor with the specific limiting factors by September 1st each year. If this proposal is enacted, the new tax would come into effect in 2025 and continue in the following years.
HB 2276: Business and Occupation (B&O) tax
Introducing a new tax on rental properties, known as the Business and Occupation (B&O) tax, which is based on the total revenue generated from renting out properties.
Additionally, it instructs the Department of Commerce to establish an optional program for residential rent stabilization. This program would limit housing providers from raising rents by more than 5% annually. Landlords participating in this program would be eligible for a B&O tax deduction.
Furthermore, there’s a requirement for the Department of Commerce to come up with suggestions for a commercial rent stabilization program. The recommendations are expected to be submitted to the Legislature by December 1, 2025.
This looming increase in property taxes demands our attention and opposition. While the existing 1% limit acts as a protective measure for homeowners, this proposal threatens to triple the burden on taxpayers. Such a drastic change can significantly impact individuals and families already navigating the challenges of housing costs. It is crucial for us to unite and oppose this proposal, advocating for responsible and fair taxation that considers the well-being of our communities. Let’s stand together to protect the financial stability of homeowners and ensure that our voices are heard in the face of this concerning policy shift. Spinnaker Property Management is here to answer any questions you may have. Give us a call today!