Advancing equity and inclusive economic strength in Baltimore requires a property tax system that is fair for all.
With careful planning and a firm commitment, Baltimore City’s property tax rate can be cut substantially, its tax base broadened, its economy strengthened and its communities made more equitable. Reducing Baltimore City’s property tax rate and capping it in the Baltimore City Charter through a referendum this November will ensure that a lower property tax rate will not change with the political winds.
The Renew Baltimore Plan will cut property tax rates nearly in half through small, manageable increments over six years.
Property taxes are a major driver of local housing markets, influencing the overall costs of buying, renting, or investing in homes and apartment buildings and spurring investment – or disinvestment – in local communities. To make our investment climate truly competitive and equitable for all current and future residents, Baltimore City must roughly halve its property tax rate. As it stands today, Baltimore City’s tax rate is 2.248% of assessed value, compared to Baltimore County’s 1.100%, which incentivizes homebuyers and businesses to build their futures outside of the city.
When Baltimore’s property tax rate is competitive, we’ll attract more capital, people and jobs - and opportunity will grow for all - making Baltimore wealthier, healthier and more equitable.
There are many dimensions to ensuring that our tax system equitably generates the revenue needed for Baltimore City residents to care for their families, build healthy communities and contribute to a strong economy. While the complicated and politically-charged nature of local tax and budget policy often leaves our elected leaders with little incentive to make long-necessary reductions to our property tax rates, Baltimore City voters have the power this November to change the City Charter through a referendum to the November ballot. Together, we can make a lower property tax rate the law in Baltimore City and unlock the economic and growth potential for homeowners and businesses now and for future generations.
What we can accomplish in Baltimore City with a lower property tax rate
A lower property tax rate for every resident and business and Baltimore
The proposed Charter amendments – designed to lower and cap Baltimore City’s property tax rate – will lower property taxes for everyone. This includes homeowners, renters and investors in every Baltimore City community.
Homeowners in Baltimore City will pay lower property tax rates. For every $100,000 of a home’s assessed value, there will be a tax savings of $3,738 over the first six years with additional annual savings of $998 every year after that. For every $250,000 of a home’s assessed value, there will be a tax savings of $9,345 over the first six years with an additional savings of $2,495 every year after that. Throughout Baltimore, homes and properties will become more valuable, growing equity for homeowners in every community. Baltimore City homeowners who currently receive the Targeted Homeowners Tax Credit will see slightly lower savings.
Property taxes are also levied on renters indirectly as landlords pass along some of that cost in the form of higher rent. With lower property tax rates, property owners will have less pressure to raise rents and more money to maintain their properties.
Businesses pay a personal property tax, which is 5.62% of the value of non-real estate property such as furniture, fixtures, equipment, commercial inventory and supplies. This percentage is calculated by law as 2.5 times Baltimore City’s real property tax rate. As such, reducing our property tax rate will also reduce the personal property tax rate, lessening the tax burden on all businesses in Baltimore and creating increased after-tax cash flow which can be used to hire new employees, increase wages and make other investments in their businesses.
A property tax rate that is competitive with surrounding counties will allow us to bring residents and investment back to the city, resulting in:
- Increased income tax revenues from increases in population and jobs.
- Increased recordation and transfer tax revenue from a higher number of real estate transactions and the higher value of the real estate transactions.
- More money in the pockets of city residents.
A reduced property tax rate will bring new investment and physical capital and with it significant job creation immediately in the form of contracting jobs, construction jobs, interior design jobs, plumbing jobs, and electrical jobs, for example. This new employment will also spur investment and job growth in city restaurants, shops, grocers and other local retailers.
Lowering our property tax rate will increase city revenues and access to high-quality public services.
Reducing the city’s property tax rates will improve city property values, expand and diversify our tax base and stimulate new investment, all of which will increase city revenues and economic growth. Any potential short-term decreases in revenues to the City are expected to be small, can be overcome with various funding mechanisms and revenue sources already available to the City and will be followed by both immediate and long-term revenue increases.
For example, increases in population, property values and real estate transactions will grow and diversify our tax base. At the same time, case studies indicate that jobs numbers will also increase as more employers are incentivized to move to Baltimore City, resulting in an growing pool of tax revenues.