As we approach the fiscal cliff in Washington, there’s a new report from St. Paul about property taxes which give some hope for the longer term. In addition to recommendations for reform, the quick education on tax policy and the history of property taxes in Minnesota is well worth reading.
I admit, I still have a wee bit of small liberal arts college idealism (even after 10 years in and around local government!), but I’d like to think tax reform could be a bipartisan effort. Rather than arguing (at the start, anyway) about raising or cutting taxes, let’s take a look at Appendix B and admit we (everybody take some responsibility here) have managed to incrementally complexify the property tax system to the point where it is collapsing under the weight of special interest protections and it is time to return to the fundamental purpose of property taxation (from the Guiding Principles of the report)
The purpose of the property tax is to provide a local revenue source to pay for local ser- vices. Although the state should define a uniform structure, the tax should be accountable to local people and the state’s involvements should be very limited. It should not be an arena for state legislators to serve constituent interests. The property tax is foremost a local revenue system, not a vehicle for state policies.