A new working paper published by the Washington Center for Equitable Growth finds a significant racial gap in property tax rates. The paper was authored by Carlos Avenancio-León of Indiana of University, Bloomington and Troup Howard of the University of California, Berkeley.
Researchers analyzed data covering 118 million homes in the United States and 75,000 jurisdictions that assessed property taxes. The data showed that Black-owned homes were assessed at higher values compared to their actual sale price, than was the cases for homes owned by Whites. Furthermore, the data showed that Black families paid on average 13 percent more in property taxes than White families with similarly valued properties. Therefore, Black property owners pay a disproportionate share of the cost for schools and public services such as fire and police protection.
The authors state that “the inequality we document in taxation is a direct, ongoing, and current source of fiscal headwinds for minority families. We estimate an additional burden of $300–$390 per year for the median Black or Hispanic family. Nearly every homeowner in the U.S. faces a property tax, and this large-scale shifting of the tax burden onto minority residents violates the notions of equity embedded in the implicit contracts that residents make with local governments.”
The full study, “The Assessment Gap: Racial Inequalities in Property Taxation,” may be downloaded at this link.