Question:
Why does my tax bill rise each year?
Answer:
Tax bills can rise over time even when you diligently contest your assessment. But, if you don’t contest your assessment, the tax increases will be even greater.
Here’s why.
Property taxes are directly impacted by local government spending. If you review your tax bill, you will see all the governmental agencies that levy a tax on your property.
The more these agencies spend, the greater the tax they take from property owners like you.
The amount government takes from you is reflected on your tax bill in the tax rate. The higher the spending, the higher the tax rate and the more you will owe.
Many governmental agencies are limited by law as to how much they can take from property owners each year. These limitations are known as tax caps. Tax caps limit tax levies from increasing from year to year by more than the rate of inflation —which has been about 2% to 3% per year recently.
But, other agencies are not limited by tax caps and they can take whatever amount they wish.
In the final analysis, you can expect tax levies to increase at least 2% to 3% each year because of increases in government spending.
So, even if you keep your property assessment under control, increases in spending could cause your tax bill to grow over time.
But, if you don’t contest your assessment, the situation will be even worse as a higher tax rate will be applied to a higher assessment causing an even higher tax bill.