One year after a ballot initiative that would have repealed parts of Proposition 13 failed, another effort to pick apart California’s property tax rules is underway.
Earlier this month, California Secretary of State Shirley Weber announced that a new initiative to raise property taxes was cleared to begin collecting petition signatures.
ADVERTISEMENT
The initiative is titled The Housing Affordability and Tax Cut Act of 2022.
Just like last year’s attempt, the new initiative proposes a split-roll tax to raise property taxes.
The initiative would increase the portion of a homeowner’s property value that is exempt from property tax from $7,000 to $200,000 and would increase renters’ income tax credit to up to $2,000.
The income limit for claiming credit would be raised to $400,000.
While single-family homes would have their exemption claim increased, commercial and pricey residential properties would face higher tax rates.
Taxes on properties with a taxable value of more than $4 million would increase and generate $16-$19 billion in new revenue.
According to the Legislative Analysts Office, that revenue would be needed to make up for the decreased revenue that would result from the tax breaks to single-family home owners.
Those properties worth more than $4 million would have their property taxes increase by 1 percent in addition to the hikes already permitted under Proposition 13.
The new attempt is a different approach to a partial repeal of Proposition 13 than the measure that failed in 2020.
Last year’s proposition 15 would have reassessed commercial and industrial properties valued at over $3 million, which would have generated about $12.5 billion in tax revenue.
