"This is an issue that affects people all over our state," said Rep. Borders. "There were parts of Indiana where property taxes were rising dramatically and being able to cap those amounts has provided property tax relief for many Hoosiers."
Indiana property tax caps limit the amount of property taxes to 1% of gross assessed value for homesteads (owner-occupied), 2% for other residential property and farmland, and 3% for all other property.
In the 91 counties that have billed 2011 property taxes, taxpayers received approximately $566 million in direct tax relief from the caps.
The property tax caps are beneficial to taxpayers because the caps provide a sense of predictability. Furthermore, taxpayers who would otherwise pay above the cap receive direct property tax relief in the form of a tax credit, also known as a circuit breaker credit that reduces the bill to the capped amount.
"These tax caps also ensure that local governments are forced to live within their means and doesn't allow them to overtax Hoosier citizens," said Rep. Borders. "I am in favor of the caps because it brings assistance to taxpayers and makes sure citizens are taxed at a fair and reasonable rate."
Taxpayers at the 1% cap received direct relief of $164.2 million, while those at the 2% cap received $243.5 million and those at the 3% cap received $154 million. A more focused cap exists for low-income senior citizens to cap their year-over-year growth; this cap provides $4.3 million of direct relief for seniors.