Strengthening the Local Property Tax

The property tax is the most important source of local revenue. But while it is widely believed to be fair, efficient, and simple to administer, in practice it has begun to drift from these ideals. Some of the factors that undermine the property tax are beyond the control of local officials. Others, however, are not, and they continue to exacerbate problems with the property tax that are detrimental to local governments. This paper explores the concept of state tax expenditure budgets and their potential role in informing the debate on various property tax policies that cost local governments own-source revenues.