TAXES AND ASSESSMENTS 1. Lien of taxes on property.—The ownership of real property is subject to the state's power of taxa tion. Taxes are a regular and enforced proportional contribution to the support of government. The tax is levied directly upon the property and when levied becomes an enforceable lien.
2. Various state and county levies.—Taxation may consist of a single annual levy for all purposes, such as is made in the City of New York, or it may consist of several levies, a method which obtains in the districts outside incorporated cities. The several levies may be some or all of the following: (a) State tax. This is a contribution to the ex penses of the state government which is apportioned among the counties each year.
(b) County tax. The several counties may raise by taxation a sum necessary to keep up the functions belonging to the county government, such as mainten ance of roads and bridges, support of hospitals and in stitutions of correction, and care of the poor.
(c) Town tax. Subdivisions of the counties have distinct objects for which funds are raised by taxation. Very frequently state, county and town taxes are levied and collected at the same time.
(d) School tax. This is a separate annual tax levied in school districts outside of cities for the sup port of the public schools of the district. It is voted by the tax-paying residents of the district.
(e) Village tax. Incorporated villages have a re current tax to provide means for purposes peculiar to the village government.
(f) Highway tax. This tax is sometimes levied separately by a highway commissioner to provide for upkeep and repair of roads.
3. Determination of tax are two fac tors which determine the tax rate, i.e., the budget and the total assessed value of taxable property. The. budget represents the total amount of money to be raised, either estimated in advance, or computed after the appropriations are made. The next step after the budget is compiled consists of assessment and appor tionment. The process of assessment consists in as certaining the total value of property within the juris diction subject to the tax. A list of such property is made up by regularly appointed or elected assessors,' who indicate the respective values of all property listed, which is frequently subject to revision or re peal. The tax rate is obtained by dividing the amount
of the budget, less any revenue obtained from other sources, by the total assessed value of the taxable property. The total amount to be raised is appor tioned by applying the tax rate to the value of each separate piece of property.
In some jurisdictions, personal property is taxed at the same rate as real property, the tax on the esti mated amount of personalty being assessed against the owner. There is frequently a business tax.
4. Assessed valuations.—The assessed valuation of real property is often made by the assessors at a frac tion of its market value, such as one-third, one-half, two-thirds, etc. It is sometimes placed at the figure which it is estimated the property will bring at a forced sale. Such practices frequently lead to in equalities and it is coming to be realized that the only fair basis of assessment is the full and actual market value of the property. Full value has been defined as "the sum for which the property would be appraised in payment of a just debt from a solvent debtor." It has also been defined as "the sum which a purchaser who wishes to buy and is not compelled to buy would give to a person who wishes to sell and is not compelled to sell." As a certain sum of money must be raised. if the assessment is low the rate on the dollar is high. and if the assessment is high the rate can be low.
In many places, for purposes of taxation, the values are separated to show the value of the land and the value of any existing improvement. This method has been found to be the best for the securing of fair and even assessments.
The land is valued on the basis of the value of standard or typical lots in the vicinity; the buildings are valued at the amount they add to the land value. This amount is determined by figuring the cost of con struction and making proper deductions for deprecia tion and obsolescence. If the building is not a suit able improvement, its value may be far less than cost.