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RELATIONSHIP OF PROPERTY TAXES TO PROPERTY ASSESSMENTS AND SERVICE COSTS
There continues to
be some misunderstanding over the relationship of property taxes to property
assessments and service costs. When assessments change and/or service costs
change, taxes do not necessarily change as well. For example, as more
development (such as subdivisions or the building of new homes) takes place in a
service area, the total assessment value increases. In this case the service
costs could raise without affecting taxes for an existing home. Hopefully, the
following examples help explain these relationships.
|
Service can refer to any of the
services or taxes listed on your tax notice
eg: fire, school, hospitals |
Example of a service cost and taxes for a year |
Everybodies properties
assessment UP 25%,
service requisition no change |
Only individual property
assessment UP 25%,
service requisition no change |
Everybodies properties
assessment no change,
service requisition
UP 25% |
|
Specific Service requisition (cost): |
$
100,000.00 |
$
100,000.00 |
$
100,000.00 |
$
125,000.00 |
|
Tax Collection fee(5.5%):* |
$
5,500.00 |
$
5,500.00 |
$
5,500.00 |
$
6,875.00 |
|
Total Tax Requisition for specific Service: |
$
105,500.00 |
$
105,500.00 |
$
105,500.00 |
$
131,875.00 |
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|
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Total Assessed Value: |
$ 103,000,000.00 |
$ 128,750,000.00 |
$
103,050,000.00 |
$
103,000,000.00 |
|
Tax Rate per $1,000: |
$
1.0243 |
$
0.8194 |
$ 1.0238 |
$
1.2803 |
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Individual
Property Assess Value: |
$
200,000.00 |
$ 250,000.00 |
$
250,000.00 |
$ 200,000.00 |
|
Individual
taxes: |
$ 204.85 |
$
204.85 |
$
256.07 |
$
256.07 |
|
* BC Assessment Authority charge |
|
big decrease in tax rate to offset
increased
assessment no change in taxes
for anybody |
individual taxes up 25%
very minor change in
tax rate, less than 1/10
of a cent |
everyones taxes up 25%
big change in tax rate
to collect 25% more
money from all |
| Tax Rate Calculation Per $1000 |
| Tax Rate = Total Tax Requisition / (Total Assess / 1,000) |
| eg: $1.25 = $100,000 / ($80,000,000 / 1,000) |
| |
| Individual Property Tax Calculation |
| Property Tax = Individual Property Assess / 1000 * Tax rate |
| eg: $250.00 = $200,000 / 1000 * $1.25 |
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