One of my pet peeves about news coverage of tax increases involves the way in which the increase is described.
I’m glad reporters try to translate a “one-cent” or “three-cent” tax increase into examples that make sense to people who actually pay the taxes. This effort almost always takes the following form: “This two-cent increase means an extra $30 a year for the owner of a $150,000 home.”
That’s a nice description of the change. What it doesn’t take into account is the pre-existing level of taxation. That extra $30 makes more of a difference if you were already paying $1,000 — as opposed to $600.
The News & Observer has two tax increase stories today. One tells us that Wake County‘s property tax rate is going up by 3 cents. “That’s $45 more a year on a $150,000 home.”
I was pleasantly surprised to read three paragraphs later the description of the pre-existing tax (60.4 cents per $100 of assessed value). That’s $906 for the owner of the $150,000 home. Wake County commissioners have just voted to raise his tax bill from $906 to $951.
Unfortunately, the companion story on the Raleigh tax increase follows the more typical formula of focusing solely on the increase. Raleigh’s 4 cent tax increase “adds $80 a year to the bill on a $200,000 house.” What we don’t learn from the story is that’s $80 on top of the $790 that homeowner already pays. His tax bill is climbing from $790 to $870 (a 10 percent increase.)
Since a Raleigh taxpayer also pays the Wake County tax, the combined Raleigh/Wake bill for the owner of a $150,000 house is climbing from $1498.50 to $1603.50. That’s a $105 increase (a 7 percent hike).
This does not count any other taxes and fees. Nor does it cover the 4.7 cent tax increase associated with school bonds on the ballot this fall.
