Some of California’s politically powerful public-sector unions are gearing up for a 2016 ballot initiative that would “reform” Proposition 13 and get rid of its so-called tax “loopholes” to promote fairness. Their goal is to hike business property taxes by $9 billion a year by eliminating the limitations imposed by that groundbreaking initiative.
And the latest evidence suggests – despite supporters’ protests to the contrary – that residential property taxes could eventually be in the cross hairs.
Proposition 13 passed overwhelmingly in 1978 against a backdrop of escalating tax bills as property values soared. The measure limited taxation to 1 percent of a property’s assessed value (plus local bonds), and capped property tax increases to 2 percent annually. Real estate is reassessed each time it is sold.