(The Center Square) – Property taxes in New York state are among the highest nationwide according to a report released by WalletHub, a personal finance website that compared home and vehicle taxes across the country.
Property taxes pay for the majority of municipal services from police departments to schools.
According to its findings, New York ranked 9th highest in the country in real estate taxes with a 1.72% tax rate. A homeowner can expect to pay $5,407 on a home with a $317,700 median value.
In addition, New York City residents pay city income tax as well as state income taxes. Some local governments in the state allow for certain exemptions such as for senior citizens, veterans and the disabled and the STAR (School Tax Relief) exemption for residential property that's used as the owner’s primary residence.
WalletHub Analyst Jill Gonzalez noted that states that offer exemptions and abatements to specific categories may take a toll on other taxpayers who will pay higher taxes to fund public services.
“Having a broader base for property taxes could lower the overall rate,” she said.
She suggests legislators broaden the base for property taxes and evaluate revenue potential to see what other types of taxations would be beneficial and perhaps allow for the lowering of property taxes.
A bill recently passed by the Senate is designed to address tax-exemption disparities.
Senate Bill S1202 directs the state board of real property tax services to undertake a study on real property tax saturation.
“Municipalities with a great number of tax-exempt properties on their books are being unfairly burdened, and this is how we can start to help,” said bill sponsor Sen. Pete Harckham, D-Westchester, in a statement.
“With all the economic challenges that residents are facing, there are major inequities that need to be resolved.”
The study will investigate which counties have the highest percentage of tax-exempt properties and what impact that has had on housing and new housing in relation to population growth, new jobs and small businesses over the past five years along with any tax-exempt dedicated park land in those municipalities.
Hard hit counties could see their tax burden adjusted if there are revisions to real property tax policies resulting from the study’s finding, which needs to be completed within a year of the legislation being signed into law.
WalletHub determined which states had the highest and lowest property taxes by comparing all 50 states and the District of Columbia by using U.S. Census data and by applying assumptions based on national auto sales data for vehicle property taxes.
For real estate property taxes, WalletHub divided the “median real estate tax payment” by the “median home price” in each state, using those rates to get the dollar amount paid as real estate tax on a house worth $127,500 which is the median value for a home as of 2019.
Vehicle property tax rates were calculated based on data for cities and counties with at least 50 percent of a given state’s population, carried to the state level using weighted averages based on population size.