PRESS RELEASE

August 20, 2001

Contact: Stephen Kroes, Executive Director
Jim Robson, Senior Research Analyst
(801) 364-1837
steve@utahfoundation.org or jimrobson@utahfoundation.org

UTAH PROPERTY TAXES COMPARE FAVORABLY TO OTHER STATES

"Whether one looks at homes, apartments, commercial, or industrial property, Utah property taxes are relatively low when compared to other states." So concludes Utah Foundation's most recent research report: "Property Taxes in Utah and the 50 States."

Using data from a recent study by the Minnesota Taxpayers Association, the report compares property tax rates and amounts for 18 hypothetical properties, ranging from $80,000 residential homes to $50 million industrial properties, using both rural and urban examples. Taxes were calculated for these properties and compared to typical urban and rural areas in other states. Utah Foundation's report focuses on comparisons with nearby mountain states but also includes national rankings.

Taxes on residential homes and apartments ranked especially low compared to other states, because Utah state law grants a large tax exemption for residential property, reducing taxable value by 45 percent. Taxes on an urban home valued at $200,000 would be about $1,400, ranking 39th highest in the nation. Taxes on an urban apartment building worth $650,000 rank 47th highest (or 4th lowest) in the nation.

Despite the low nationwide rankings, Utah's property taxes rank right in the middle of mountain states. Senior Research Analyst Jim Robson, who authored the report, said, "Most of the mountain states have moderate property taxes, especially for residential homes. Arizona stands out; however, for taxing business properties at very high rates."

Business property owners face tax burdens almost twice as high as residential property owners, although these higher taxes still rank below average compared to other states. Taxes on urban commercial and industrial properties rank 38th highest in the country.

Utah Foundation's report also examined growth rates for Utah property taxes and other major taxes over 30 years. Property tax revenues have grown slower than other taxes except fuel taxes. Utah's fastest growing major tax source has been individual income taxes, followed closely by sales taxes. Since 1970, property taxes have grown slower than the Utah economy, exacting a smaller portion of Utah Personal Income. Income and sales taxes have taken a larger share of personal income during this period. Regarding the tradeoffs among these taxes, Mr. Robson stated, "During these past 30 years, the income tax burden on Utah taxpayers has just about made up for the declining property tax burden."

Utah Foundation is a nonprofit, non-advocacy research organization. Our mission is to encourage informed public policy making and to serve as Utah's trusted source for independent, objective research on crucial public policy issues.