north dakota office of state tax commissioner cory fong, tax commissioner

Impact of Measure 2

Abolishing Property Taxes

North Dakota Office of State Tax Commissioner

Cory Fong, Tax Commissioner

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 50.0%

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www.nd.gov/tax701.328.7088

Office of State Tax CommissionerCory Fong, Tax Commissioner

North Dakota State Tax System Like a 3-Legged Stool (2010)

Collections (in Millions $)

1.Sales/Use Taxes = $776.4 35.8%(State)

2.Income Taxes = $576.3 26.6% (State)

3.Property Taxes = $816.2 37.6%(Local)

Regional Comparison



Fargo 5.7% Billings 5.6% Minneapolis 10%

Sioux Falls 5.2%

Cheyenne 4.4%

Omaha 9% US Average 8.7%

0%

2%

4%

6%

8%

10%

1.0%2.4% 2.7%

2.1%2.9%

2.8%

2.6%

5.1%

2.4%1.6%

4.4%3.9%

1.5%

1.5%

2.4%

2.2%

1.9% 1.9%

0.4%0.6%

0.7%

0.4%

0.6%

0.6% 0.5%

Income Property Sales Auto

Perc

en

t of

incom

e g

oin

g t

o t

axes

Major Taxes as a Percent of Income

Family of 3 - $50,000 per year

SOURCE: Tax Rates and Tax Burdens in the District of Columbia – A Nationwide Comparison 2009, Government of the District of Columbia

What Do Property TaxesCurrently Support?



Schools; 45.1%

Cities; 20.9%Coun-

ties; 29.9%

Misc. Districts,

1.6%

Townships, 2.2%

State, 0.3%

Schools Cities CountiesMisc. Districts Townships State

shift to

Abolishing Property Taxes =Tax Shift



shift to

primarily oil/gas taxes

Schools

CitiesCountiesTownships

Misc Districts

SalesIncomeOil/GasAlcohol &

TobaccoLottery &

GamingFinancial

InstitutionOther State

Resources

If property tax is abolished, ►the lost revenue would need to be replaced

Sales tax rate would double

Current rate New rate5% 10%

Impact on other Tax Rates



If property tax is abolished,

►the lost revenue would need to be replaced

Individual Income Tax rates would increase 279% over 2011 rates

►Across the board increases!

2011 rates New rates1.51% 5.72%2.82% 10.69%3.13% 11.85%3.63% 13.75%3.99% 15.11%

Impact on Tax Rates



If property tax is abolished, ►the lost revenue would need to be replaced

Corporation Income Tax rates would increase 720% over 2011

rates

2011 rates New rates1.68% 13.9%4.23% 34.6%5.15% 42.2%

Impact on Tax Rates



Questions?



Office of State Tax Commissioner►[email protected]►www.nd.gov/tax►701.328.7088 or 877.328.7088►600 E Boulevard Ave, Dept. 127

Bismarck ND 58505-0599

north dakota office of state tax commissioner cory fong, tax commissioner

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