[robocat]

> Suddenly, property tax on everyone's $0.01 parcels shoots up from $0 to $12,000 per year

In New Zealand, property taxes are relative: the tax you pay depends on how much your property price rises relative to everybody else’s property prices. The local government has a fixed budget, which is apportioned between all the properties proportional to property values.

Example: a city has a budget of $1000. The city has two houses, one worth $100k and another worth $900k. The property taxes are $100 and $900 (ignoring fixed charges). If the houses double in value to $200k and $1800k, the property taxes are still $100 and $900.

It is important to keep this in mind when arguing about property price increases, because price increases don’t always matter.

[earleybird]

I believe that's the typical scenario.

taxes = mill-rate * property-value

If you're paying more in taxes it's either because the taxing authority decided to raise more money or your property has increased relative to your neighbours.

It all comes down to the mill rate.

[DubiousPusher]

Not most places in the U.S.

If your whole neighborhood's valuations go up you all get taxed more.

[sokoloff]

If your whole neighborhood goes up, but not the whole city/municipality, correct. If the entire tax base goes up (not just one neighborhood), you should expect the mill rate to fall.

[onlyrealcuzzo]

Does it actually, though?

In practice - aren't tax rates changed based on politics?

[TimPC]

Tax rates are generally changed by an independent political process (the municipal budget) which often has the power to increase/decrease the mill rate based on how much money is needed/desired. This doesn't change the fact that the mill rate does generally fall by a lot when properties are reassessed in areas that have seen a large property price increase.

[DubiousPusher]

This is not the case where I live. Levy rates are set in statute.

[robocat]

Are rates proportional to house valuations used in “most places in the U.S”?

That is, are most rates not “mill rates” (where relative house values matter, not absolute values).

[DubiousPusher]

Yeah I'm very curious about this. I assumed that because my taxes have been purely proportional in the several places that I've lived that this was generalized to across the U.S.

This is the first I've heard of a city adjusting taxes down.