Please read this and contact Chris or urge your Senator directly to get them to support SB2079!
We’ve Had Enough--Real Property Tax Reform
Wednesday, March 02, 2005
By Senator Chris Lauzen
I know of no other place in the Tax Code, other than property taxes, where unrealized capital gains are taxed. When stocks that you own increase in value, you do not pay tax until you sell. When a business that you own increases in value, you do not pay tax until you sell. However, when your home appreciates or increases in assessed value, you pay a higher priority tax every year even though you haven’t sold it and “realized” that gain.
As homeowners, why do we allow the government to tax us on property capital gains on our homes that we may never receive? I need your help to stop this practice and freeze assessments for all until you sell your home and buy a new one.
Constituents call and ask me, “Hey Chris, who owns my home?” I reply, “Well, Harry, since you paid off that mortgage, certainly you do.” He disagrees and corrects me, “Tell me what happens to the house that you say I own if I fail or refuse to pay my property taxes…No, the government owns my house and they’re taxing me right out of it! In fact, the property taxes I pay today exceed what my old mortgage payment used to be, including principle and interest.”
Why do we tolerate such a system? The government has had its way unfairly with us for too long.
This week I submitted legislation on your behalf to provide massive, permanent property tax relief (SB2079). I propose that we “freeze for all” property tax assessments until you sell your home and buy a new one.
For those who must be a lot wealthier than most of us and who say that this is impractical because of the growing financial needs of local government and schools, I propose “leveling the playing field” for the proper collection of sales tax on purchases made over the Internet (SB2080). When we buy an item from our local retailer, we pay sales tax. When we pick up the phone and buy an item, we pay sales tax. But, when an item is purchased at a computer terminal, there’s no sales tax collection enforced.
How can this inconsistent application of sales tax collection be fair, especially to the local retailer who pays property taxes like the rest of us and provides jobs? This is enforcement of sales tax collection on “purchases over the Internet”, not on “access to the Internet”. In fact, the legislation I propose repeals the telecommunication tax that is currently charged on your D.S.L. internet access.
The revenue provided by this consistent application of the sales tax law is $600,000,000 each year and growing at 20% per year. Twenty percent of the sales taxes collected from this source will go to local government in the same way that it is currently distributed and the remaining 80% will go back to school districts on an equitable per-pupil allocation.
In the end, the reason why taxes are increasing so rapidly is because government spending is increasing so rapidly. Just as we have the local property tax cap, the state government should have a state spending cap. I propose that we should cap spending for state government at the rate of economic growth and increases in population growth in Illinois (SB1358).
If you agree with these initiatives, please call your local senator and ask her/him to co-sponsor these bills. If you don’t know who to contact, please call me at 217-782-0052 and we’ll give you the name and phone number. Also, write a letter to your local newspaper’s editor in support for these reforms.
We’ve had enough--unrealized gains on our homes should not be taxed.
We’ve Had Enough--Real Property Tax Reform
Wednesday, March 02, 2005
By Senator Chris Lauzen
I know of no other place in the Tax Code, other than property taxes, where unrealized capital gains are taxed. When stocks that you own increase in value, you do not pay tax until you sell. When a business that you own increases in value, you do not pay tax until you sell. However, when your home appreciates or increases in assessed value, you pay a higher priority tax every year even though you haven’t sold it and “realized” that gain.
As homeowners, why do we allow the government to tax us on property capital gains on our homes that we may never receive? I need your help to stop this practice and freeze assessments for all until you sell your home and buy a new one.
Constituents call and ask me, “Hey Chris, who owns my home?” I reply, “Well, Harry, since you paid off that mortgage, certainly you do.” He disagrees and corrects me, “Tell me what happens to the house that you say I own if I fail or refuse to pay my property taxes…No, the government owns my house and they’re taxing me right out of it! In fact, the property taxes I pay today exceed what my old mortgage payment used to be, including principle and interest.”
Why do we tolerate such a system? The government has had its way unfairly with us for too long.
This week I submitted legislation on your behalf to provide massive, permanent property tax relief (SB2079). I propose that we “freeze for all” property tax assessments until you sell your home and buy a new one.
For those who must be a lot wealthier than most of us and who say that this is impractical because of the growing financial needs of local government and schools, I propose “leveling the playing field” for the proper collection of sales tax on purchases made over the Internet (SB2080). When we buy an item from our local retailer, we pay sales tax. When we pick up the phone and buy an item, we pay sales tax. But, when an item is purchased at a computer terminal, there’s no sales tax collection enforced.
How can this inconsistent application of sales tax collection be fair, especially to the local retailer who pays property taxes like the rest of us and provides jobs? This is enforcement of sales tax collection on “purchases over the Internet”, not on “access to the Internet”. In fact, the legislation I propose repeals the telecommunication tax that is currently charged on your D.S.L. internet access.
The revenue provided by this consistent application of the sales tax law is $600,000,000 each year and growing at 20% per year. Twenty percent of the sales taxes collected from this source will go to local government in the same way that it is currently distributed and the remaining 80% will go back to school districts on an equitable per-pupil allocation.
In the end, the reason why taxes are increasing so rapidly is because government spending is increasing so rapidly. Just as we have the local property tax cap, the state government should have a state spending cap. I propose that we should cap spending for state government at the rate of economic growth and increases in population growth in Illinois (SB1358).
If you agree with these initiatives, please call your local senator and ask her/him to co-sponsor these bills. If you don’t know who to contact, please call me at 217-782-0052 and we’ll give you the name and phone number. Also, write a letter to your local newspaper’s editor in support for these reforms.
We’ve had enough--unrealized gains on our homes should not be taxed.
