IPTI | Property Tax in the News – August 2026

IPTI’s usual monthly newsletter – the “President’s Message” – contains, inter alia, some summarised news articles from around the world. This IPTI publication – “Property Tax in the News” – contains some of the more interesting news articles concerning property taxes in North America and Europe which is where many of our members have a particular interest. Links to these and more, similarly summarised, articles – from North America, Europe and around the globe – can be found in “IPTI Xtracts” on our website: www.ipti.org. Please note that these are news articles; they do not necessarily reflect IPTI’s views.

USA

Localities Try Vacant Land Taxes, Mansion Taxes and Second Home Taxes, while States Stick to Same-old Tax-cut Strategies

In 2026, cities, counties, and school districts must manage tax cuts coming from federal and state governments, the end of federal pandemic aid, rising costs, and a stagnant economy. This challenging environment is forcing municipalities of all types to ask how they can best fund core priorities and invest in communities in the long term. Larger concerns about affordability are encouraging localities to get creative on adopting new taxes on the wealthiest residents.

New or Improved Local Taxes

One of the more prominent trends this year has revolved around real estate. Mansions, second homes, and vacation rentals stress local housing markets by driving up the costs of living for permanent residents. Increasing property values reduce availability of affordable homes for first time buyers, raise property taxes for all owners, and can limit the availability of all housing units, both by restricting the number of units on the market, as well as making it much more challenging for new housing to get built.

Cities across the country have adopted a range of new taxes on real estate. New York City created a new pied-a-terre tax, going into effect this year. The city will collect an estimated $500 million in the first year. Hawaii County also created a new property tax rate on non-owner-occupied homes worth more than $4 million in response to a growing number of vacation homes on the island. The new rate will raise an estimated $94 million next fiscal year. Taxes on expensive second homes are
becoming increasingly common across the country.

Some cities are also exploring ways to reduce vacant or underused land. Louisville-Davidson County, Kentucky received approval from the state to raise the property tax rate on vacant lots and surface parking lots to spur denser development. Charlottesville, Falls Church, Fredericksburg, and Newport News, Virginia, were given permission by the statehouse to tax land at a higher rate than buildings. Persistently vacant properties are bad for neighborhoods, and this policy, known as split-roll
property taxation, is one way to fight against the problems caused by vacancy.

Some other cities protected or strengthened their local income taxes. Local income taxes can inject much-needed progressivity into otherwise upside-down local tax codes. Voters in St. Louis and Kansas City, Missouri strongly supported keeping their cities’ local income taxes despite continued attacks on the state’s personal income tax. Portland, Oregon amended the city’s arts tax, raising the annual fee but exempting low-income households. Montgomery County, Maryland created a marginal income tax structure for the county income tax, while maintaining the county earned income tax. And two school districts in Ohio adopted new local earnings taxes to close budget gaps and maintain their property tax rates.

And one of the most promising emerging tax stories comes from Chicago. Late last year, the city adopted a tax on large social media companies, with funds dedicated to community mental health services. The city now expects to collect nearly 60 percent more revenue from this tax than originally estimated, making this a windfall for the city.

Communities across the country are using novel taxes to raise needed revenue and improve the progressivity of their tax bases. Our recent report co-authored with Local Progress Impact Lab describes the best policies for taxing the rich at the local level. In lieu of state or federal action to hold the wealthy and corporations accountable for their duty to their fellow residents, localities can and should lead the way to build support for greater action towards more fair tax systems.

Continued Property Tax Cuts

Despite evidence old and new that widespread, untargeted property tax cuts undermine local budgets and have little effect on housing affordability, an unrelenting push for property tax cuts continues. The Republican parties of Idaho and Indiana even put property tax elimination in their
party platforms, meaning this bad idea is spreading.

This year, multiple states and municipalities have cut property taxes or placed referendums on the
ballot for voters to decide.

In November, Florida residents will vote on a referendum that would restrict homeowner property taxes by increasing the exemption on non-school taxes to $250,000 by 2028. The text of the referendum would force cities to severely restrict spending, destroy credit ratings across the state, and could drive up property tax rates on other properties, like rental housing and commercial property. The referendum also pits current owners against new homebuyers by forcing new buyers to wait five years before qualifying for the same benefits as everyone else. This will penalize Floridians buying their first house.

Georgia placed an inflation cap on property tax growth, with the option for cities and counties to levy new sales taxes to make up the difference. Housing inflation over the past six years has vastly outpaced general inflation, and this will make those assessments less accurate. In addition, new sales taxes are far more regressive than property taxes are and would shift the tax share onto low-income households.

Iowa created a 2 percent revenue growth cap for virtually all local governments and replaced the homestead tax credit with a property tax exemption. The bill also raised the property tax rate for multifamily residential buildings. Municipalities will lose over $432 million by 2033.

North Carolina froze property assessments, which will make assessments less reliable, drive wedges between neighbors due to uneven assessments, and weaken public funding for essential services. In addition, voters will be asked about a constitutional levy limit, which would severely restrict how local governments raise revenues from property taxes, and which would give the biggest tax cuts to the wealthiest residents.

South Dakota, like Georgia, authorized a sales tax/property tax swap. Sales tax revenues must be dedicated to cutting property taxes.

Wyoming is looking to double down on last year’s catastrophic property tax cut with another. The state will hold a citizen-sponsored referendum that would exempt 50 percent of a primary residence’s value from property taxation. Last year, Wyoming’s legislature exempted 25 percent of a home’s value up to $1 million from property tax. Though that version had a cap attached, cities, counties, and special districts across the state were forced to make major cuts, and the law has led
to ongoing lawsuits between the governor and the state’s Board of Equalization over concerns about the law’s constitutionality. Exempting half of all homeowner property value in the state from taxation would effectively destroy local government service capacity and give the biggest tax cuts
to the wealthiest homeowners.

Leaders in Warren County, Ohio have also eliminated their property tax millage for property owners, opting for a local sales tax instead. Though this was announced as a one-year change, it may be renewed. The swap introduces inequities, with the sales tax asking even more of families who can afford it the least.

Many of these trends point toward deep revenue loss, and eventual cuts to core public priorities. The services people receive from their local governments – paved roads, garbage collection, safe parks and libraries, clean water, and educated children – cannot be paid for with hopes, dreams, and promises. Local services are paid for by all of us for the benefit of all. Lawmakers that continue to cut away at funding options for municipalities, schools, counties, and special districts are undermining the very things that make people choose where to live in the first place.

Florida: Here’s the new language for Florida’s property tax amendment

If approved by voters, legislation takes effect on Jan. 1, 2027. After a judge ruled that a proposed property tax amendment was “misleading,” new ballot language has finally been revealed for the plan.

This comes after the judge ordered the Florida attorney general earlier this month to rewrite the ballot measure, which he said was full of “political taglines” aimed at making the amendment seem more appealing to voters

However, the judge reasoned, the purpose of the summary is to explain what the amendment does; not advocate for its adoption. This week, Attorney General James Uthmeier released the reworked copy, which reads as follows:

“This amendment increases the homestead exemption, for all non-school taxes, to $150,000 in 2027 and $250,000 in 2028, and adjusts for inflation thereafter. It requires the Legislature to prescribe a uniform procedure for counties and municipalities, for their respective levies, to increase the homestead exemption up to full assessed value, and allows special districts, subject to referendum approval, to do the same.

Persons who are not Florida residents on December 31, 2026, will receive the existing homestead exemption upon qualifying for a homestead exemption, with the increased homestead exemption beginning with the fifth year of exemption, to the extent permitted by the U.S. Constitution.

This amendment reduces the annual cap on assessment increases for non-homestead properties from 10% to 5%.

This amendment requires counties and municipalities to use property taxes solely for public safety, education and schools, infrastructure, natural resources, bond debt service, retirement benefits for employees, and operations and administration. Other expenditures may be approved by county officers or county or municipal governing bodies unless prohibited by general law, notwithstanding Article VII, Section 9(a) of the Florida Constitution, which allows counties and municipalities to levy property taxes for their respective purposes.”

Constitutional Amendment 3 – Increased Homestead Exemption

WHAT DOES THE AMENDMENT DO?

As the reworked amendment language states, the proposal aims to expand the homestead exemption in Florida, lowering property taxes for many homeowners across the state.
Because property taxes are a local issue under the state Constitution, this means lawmakers must approve an amendment to make any meaningful changes.

As such, a list of changes made by the proposed amendment is as follows:
• Homestead Exemptions: Provides a new homestead exemption for non-school taxes for the first $150,000 of assessed value of homestead properties in 2027; and the first $250,000 of assessed value in 2028 and thereafter.
• Out-Of-State Homeowners: Creates a five-year homestead exemption on the first $50,000 of assessed value of homestead properties ($25,000 for school levies, $50,000 for non-school levies) for owners who are not permanent residents as of Dec. 31, 2026
• Such property owners may receive the same homestead exemption as permanent Florida residents after five years
• Assessment Increases: Reduces the non-homestead property assessment increase limitation from 10% down to 5% annually.
• Tax Restrictions: Limits the use of ad valorem revenue by local governments to the following purposes:
o Public safety, including law enforcement, EMS and fire services
o Education and public schools
o Infrastructure, including roads, bridges and stormwater controls
o Natural resource projects, including flood control measures
o Issue local bonds for approved uses or to make debt service payments
o Meet obligations and retirement benefits of local government employees
o Fund the operations and administration of county officers and commissioners

DIFFERENCES FROM THE ORIGINAL PLAN
Florida Gov. DeSantis has been a vocal proponent of property tax reform, pushing legislation this year titled the “Save Our Homes” Act.
While the amendment still cuts property taxes for homeowners, it diverts from DeSantis’ original vision in a few key ways:
• Full Elimination: Rather than just expanding the homestead exemption, DeSantis’ plan called for fully phasing homestead property taxes out.
• Local Funding: The original plan also included a state fund that would have provided local governments with state grants to help cover core services while property taxes were phased out.

Regardless of the changes, Florida voters will get the opportunity to decide on the latest amendment later this year. The general election will be held on Tuesday, Nov. 3. If approved by at least 60% of voters, HJR 1F will take effect on Jan. 1, 2027.

Ohio: Amazon, Meta avoid millions in property taxes for Ohio data centers

Ohio data centers have racked up millions of dollars in property tax breaks from local officials who want to attract more development.

Amazon Web Services avoided $5.4 million in property taxes for two Hilliard data centers in tax year 2024, the most recent figures available, according to the Franklin County auditor’s office. Neighboring Licking County reported $1.8 million in forgone taxes from Meta’s Prometheus campus last year. A Google data center in Lancaster cost $1.3 million.

The statehouse bureau sought to examine local tax agreements for data centers amid mounting opposition to these projects. That information is located in a patchwork of records across dozen of governments, making it difficult to understand the full picture.

But an analysis of 20 tax abatements showed how far some local officials will go to woo businesses− including the world’s biggest tech giants. “We’ve created the tools and given the toolbox to local governments,” said Rep. David Thomas, R-Jefferson. “They’ve used every tool in the toolbox and then some.”

Data centers often benefit from Ohio’s Community Reinvestment Area program, which offers tax exemptions for property upgrades. Agreements last up to 15 years − or 30 years for megaprojects − and reduce the companies’ tax burden during that time. Recipients typically agree to meet certain requirements for investment or job creation.

Proponents say the incentives help Ohio communities compete for projects that are shopped around to multiple states. And it’s not always a total loss. In some cases, data center operators have agreed to pay the municipality or school districts to make up for abated tax revenue.

Still, critics contend some of these deals go too far − especially when data centers also qualify for a state sales tax break. Gov. Mike DeWine paused that exemption after officials learned it soared to $1.6 billion last year.

“It’s really just concentrating this responsibility for funding schools on these communities and the people living there,” said Aditi Srivastava, a researcher for Policy Matters Ohio.

Anatomy of a tax abatement

Tax abatements are just one type of incentive offered by local governments − and data centers aren’t the only businesses that get them. Franklin County is home to the most tax abatements overall, valued at more than $8.4 billion last year, according to the Ohio Department of Taxation.

The department aggregates total tax abatements by county, but it doesn’t maintain a list of affected properties. To learn more about data center deals, the statehouse bureau reviewed publicly available information and received details from a sample of local governments, largely concentrated in central Ohio.

The agreements include:
• A Meta data center in Bowling Green that will reduce annual property taxes by an estimated $2.5 million.
• Two 10-year, 100% abatements for Amazon properties in Union County that saved the company nearly $1.4 million last year.
• An Amazon data center in New Albany that cost Licking County around $705,000 in 2025.
• A TJX data center in New Albany with more than $267,000 in forgone taxes for 2024.
• A data center owned by STACK Infrastructure in New Albany that saved about $138,000 in 2024.
• A 30-year, 75% abatement for a Stark County data center to be operated by Amazon.
• A 15-year, 75% abatement for a Google data center campus in Scioto County

Local officials say there’s more to these abatements than lost tax revenue. Google’s Scioto County agreement includes $500,000 that will go toward a tax levy for Green Local Schools, said Scottie Powell, chairman of the Scioto County Commissioners. In Bowling Green, Meta will pay affected school districts a projected $1.2 million per year, according to Wade Gottschalk, executive director of Wood County Economic Development.

Amazon will give $50 million to the city of Sidney and Sidney City Schools in exchange for an abatement. Perry Township will get $2.75 million upfront for the Stark County project. The company also donated to a fieldhouse project in New Albany and launched STEM education labs within Hilliard City Schools. New Albany − considered a hub for data centers − uses a set formula to ensure companies make a minimum annual payment to the city in lieu of property taxes.

“The real question isn’t what are we losing?” said Jennifer Chrysler, director of community development for New Albany. “It’s what are we gaining that we would not have otherwise. That’s been able to position us to win.”

Will Ohio regulate local tax breaks?

Amazon did not respond to a request for comment. The company has invested $39.9 billion into Ohio data centers that support 9,500 jobs, said Craig Sundstrom, head of energy and sustainability policy, during a June statehouse hearing. “These are real jobs, held by real Ohioans, who build, connect, operate, power and maintain the digital economy that powers American innovation and makes us competitive,” Sundstrom said.

Meta spokesperson Rachel Holland said tax incentives are useful tools for state and local governments to support development. In turn, Holland said, data centers generate economic activity and millions of dollars in tax revenue that support schools and local services. But some companies know they have a public relations problem.

In June, a Microsoft representative said the company would no longer seek property tax abatements for its Ohio data centers. A spokesperson told the statehouse bureau that Microsoft has “not collected any local property tax incentives in Ohio, and we do not intend to going forward.” The spokesperson would not answer questions about an abatement for a Microsoft data center approved by the New Albany City Council in 2024.

It remains to be seen whether lawmakers will tackle the issue. They deadlocked on data center legislation that, in part, would cap property tax exemptions at 50% and require more assurances for local deals. Thomas believes data centers should get state or local property tax breaks − but not both. At the same time, some legislators don’t want to step on the toes of local leaders.

“I would prefer if they don’t get any abatement,” said Sen. Kent Smith, D-Euclid. “But mayors and township trustees and city councils are empowered by voters to make decisions which are in their communities’ best interests.”

CANADA

Which Municipalities Rely Most on Property Taxes?

Municipalities across Canada rely heavily on property tax revenues to support their operating expenditures. Halifax and Montreal have the highest share of municipal operating revenues from property taxes, while Toronto gets just 31 percent of its operating revenues from property taxes.
Analyzing property tax contributions to municipal operating revenues relate to development charges as these charges are an additional source of revenue for municipalities, limiting the potential increases in property taxes rates for homeowners.

EUROPE

Axe stamp duty? How Andy Burnham could change property tax

Residential property is the largest store of wealth in the UK and has long been a target for those who believe homes should be taxed more. Real estate remains a juicy plum for Andy Burnham to pick as he searches for ways to pay for an overhaul of the social care system and higher defence spending, to name just two fiscal priorities. Yet how to tax property, or possibly the land it sits on, has vexed economists and politicians for centuries. Here we discuss the background to the debate and some of the tax options.

Council tax, stamp duty land tax and capital gains tax (CGT) are the main taxes charged on English properties. All residents pay council tax based on the value of the home at 1991 prices and in a series of bands from A to H – while several extra bands are being added at the top end to enact Rachel Reeves’s mansion tax. Property taxes in Scotland, Wales and Northern Ireland are under the control of devolved administrations, who apply different systems – in Wales, property valuations from 2003 are used. Plus, landlords in the UK must pay income tax on rental profits, while companies pay business rates based on the rental value of their premises.

Together, the UK raises more from property taxation than any other country in the OECD. The Office for Budget Responsibility has estimated that council tax receipts will total £51bn in the 2025-26 financial year, plus £34bn from business rates, and £17bn from property transaction taxes (including stamp duty). Like King William III’s window tax, council tax is widely considered to be a failure, or at least past its sell-by-date, leading to calls from politicians on left and right for it to be reformed or
abolished. It is a regressive tax, falling more heavily on low-value homes, and rates vary across the country.

Stamp duty applies to home sales and takes a bigger slice out of higher-value homes while many cheaper home sales are exempt, making it a progressive tax. Second homes, which are owned by about 10% of main residency owners, are caught by stamp duty and capital gains tax (CGT) on the profit from a sale. UK residents owned about £5.5tn worth of property in 2022 after mortgages were deducted, and Burnham’s advisers have hinted that the PM is keen to capture some of this wealth
via a single annual tax on property based on the wholesale reform of council tax and abolition of stamp duty.

It would be a monster task to revalue all homes in England, and the Valuation Office would need to hire many staff, though artificial intelligence is expected to be a huge support in this exercise. Council tax’s critics argue that it damages the economy when people are deterred from moving to deprived areas with low house prices, but high levels of council tax. A band D council tax bill in Wandsworth this year is £1,028 while a home in the same band in Leicestershire must pay £2,528.75,
just short of the highest band D of £2,625.43 in Dorset.

A single flat-rate tax based on land or property valuations would favour poorer areas. It would also provide the government with a regular income because it must be paid whatever the economic situation while stamp duty and CGT largely dry up during recessions, when fewer people are willing or able to buy. Economists prefer a land tax because a levy on property deters owners from making improvements that would increase its value. He has also criticised property developers who delay
using the land they own because there is no tax to pay until something is built.

Land banking is a curse the prime minister wants to end. A land value tax charged at 1.28% of the value, replacing council tax and residential stamp duty, would result in about two-thirds of households paying less, and a third paying more, Tax Policy Associates has calculated.

Dan Neidle, the firm’s founder, says under this scheme a band D home (average value of £358,000) would BE charged £2,551 compared with an average £2,267 council tax bill and a potential stamp duty charge of £7,933. A band H home would be the biggest loser. With an average value of £2.6m, Neidle says the occupier now pays £4,081, but under an LVT that would rocket to £30,534, though should they sell, a £200,000 stamp duty bill would be waived.

The scheme takes into account that top-end home values would fall, while the bottom end of the market would rise. Most of the extra charge would apply to London and the south-east with the addition of Trafford in Greater Manchester, Bath and other affluent areas. Land tax proponents say that over time, the percentage rate can be increased, allowing politicians to abolish other taxes until such time as income tax and national insurance are swept away, with a land tax paying for everything.

Another option would be a proportional property tax – a single flat rate tax charged annually on a property’s value. The Fairer Share campaign has proposed this could be set at 0.48% and doubled for second homes. Rachel Reeves reportedly examined the merits of replacing stamp duty with a “proportional” property tax in 2025. A third possibility would be a beefed-up transaction tax – scrapping principal private residence relief (which allows main residences to escape CGT) and charging a levy on the capital gains when any property is sold, even if it was bought decades ago, when prices were much lower. Practically, an overhaul of council tax would take years, and could be phased in from the top down. The Oxford academic Prof John Muellbauer has had talks with Treasury officials about applying a percentage to the value of top-end homes after the Valuation Office has completed the project begun by Reeves to underpin the mansion tax. Lower bands could
be slowly updated from the 1991 numbers until all homes pay a percentage tax.

Older voters living in large, expensive homes might be unable to afford the higher charges under either a refreshed council tax or LVT scheme, but most economists say they could delay payment until their estate is sold. Neidle says such concessions show how a large-scale conversion to LVT that involves scrapping stamp duty would trigger a significant drop in government income in the short term when the point is to raise more money. But while there would be losers under changes to the property tax system, Fairer Share argues that a 0.48% proportional property tax would mean lower bills for most households while shifting the tax burden to higher-value properties and second homes.

 

 

Compliments of the International Property Tax Institute – a member of the EACCNY