Speaker Pro Tempore Dale Folwell offered some insightful comments during yesterday’s House debate on annexation reform. (It passed 70-44) For cities to remain viable they may need to consider who and what they tax. In Winston Salem, 13% of land within the city limits is not taxed, in Charlotte, 12% pays no city taxes and in Raleigh, 16% is exempt from city taxes. Supporting annexation reform, Folwell suggested that “you can’t finance city services on the backs of citizens living outside city limits.”
Schools, parks and government buildings do not pay property taxes. Neither do universities, hospitals and various non-profits. Some companies have negotiated sweet deals that lower or exempt them entirely from paying local taxes. When fewer pay, the rest have to pay more.
Cities claim they need to be able to annex citizens living outside the city limits in order to increase their revenue, to grow and provide services. Perhaps they need address tax equity to ensure everyone within their city limits is paying their fair share first.
