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While Assessors “don’t do”
taxes, we do study them, and it appears that Nashville taxpayers are rather
fortunate. Consider this:
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Tennessee ranks 48th lowest
among states, when comparing tax burdens as a percentage of income.
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Metro’s property tax rate has
remained substantially lower than the three other major Tennessee cities
for over 25 years.
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The above chart compares
combined "city-county" tax rates for the 2004 tax year. |
Perhaps, more surprising is that
Nashville's rate now is two cents lower than Clarksville-Montgomery County
and only six cents higher than Murfreesboro-Rutherford County.
Since all four “big cities”
reappraised in 2001 and 2005, it is fair to compare rates. The other two
counties recently finished their reappraisals and were at 100% values, based
on the State’s studies.
Students of the metropolitan
form of government believe the consolidation of city and county plays the
major role in keeping property taxes lower in the capitol city. They
point out that prior to "Metro," the city and county governments constantly
were competing for tax dollars to fund their services and there were
duplications of administrative, legislative and judicial branches.
Consolidation solved both those
problems beginning in 1963. Regardless of where the credit belongs,
Nashville has managed to increase and expand services while keeping the
property tax rate from spiraling upward as it has in many cities where
taxpayers are less fortunate.
Why a property tax?
The ad valorem property tax has
been the life-blood of local government for centuries.
Not only is it one of the oldest
tax forms recorded in civilized history, it is considered one of the most
stable revenue sources because growth in property values usually offsets
inflation rates that affect a government’s expenditures and make balancing a
budget challenging.
Its
revenues support schools, police, fire, emergency management,
health, hospitals, social services, ambulances, public works,
libraries, parks, courts, jails and other services that make our
city a great place in which to live and work.
The property tax pays about 46%
of the bill for Metro services, as shown in this revenue graph for the
current fiscal year, as prepared by the Metro Finance Department.
Other major sources are the
local option sales tax which contributes 18% and grants and contributions
(mainly state and federal funds) which total 19%. Fees, fines, etc., provide
13% and fund balances represent 4% of the total revenues.
More information on the current
budget is available at:
Citizens Guide to the Budget |