Eliminating property taxes would force hikes elsewhere

By: The Associated Press
By: The Associated Press

An analysis by the Legislative Services Agency says property taxes in Indiana could be eliminated by raising other state taxes.

The agency says it could be done by raising the sales tax from 6 percent to 13 percent, or by raising the individual income tax from 3 percent to 9 percent. It says either of the options could raise the 6 billion dollars that property taxes are bringing in this year to pay for local governments and schools.

The figures were presented to the Commission on State Tax and Finance Policy today.

The panel of lawmakers and outside tax experts is exploring ways of reducing local government's reliance on property taxes. They may have recommendations for the General Assembly to consider as early as November.

The group is focusing on the issue this summer and fall because a variety of factors is expected to increase property taxes on homeowners an average of 24 percent statewide.


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