12 States With the Highest Property Taxes

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In fiscal year 2021, property taxes comprised 30% of total state and local tax collections in the U.S., according to a new report from the Tax Foundation. This was more than any other source of tax revenue, even though property taxes were levied almost exclusively at the local, not state, level.

Property taxes are local governments’ primary tool for funding schools, roads, police departments, fire and emergency medical services, and other services associated with residency and property ownership. In fiscal 2021, they accounted for 72.5% of local tax collections, the report said. 

How Governments Tax Property

Property taxes tend to be imposed at the local level, although state law typically establishes their basic framework, according to the report. Some governments impose a millage on the fair market value of the property; others impose it on a percentage of the market value. Although values are often determined by comparable sales, jurisdictions also differ in how they calculate assessed values. 

Some states have equalization requirements that ensure uniformity across the state. Sometimes property tax limitations restrict the degree to which one’s property taxes can rise in a given year. In other instances, rate adjustments are mandated after assessments to ensure uniformity or revenue stability. 

Abatements are often available to certain taxpayers, such as veterans or senior citizens, and residential property is usually taxed at a lower level than commercial property. 

The report noted that several states with high property taxes rely heavily on these revenues in lieu of other major tax categories. Other states with high property taxes impose them alongside other high taxes.

According to the report, the dollar value of property tax bills often fluctuates with housing prices, which can make it difficult to use this measure for comparisons between states. 

However, one way to compare is to look at effective tax rates on owner-occupied housing — the average amount of residential property taxes actually paid, expressed as a percentage of home value.

See the gallery for the 12 states with the highest property taxes in 2022 (the most recent data available). The figures in each slide are mean effective property tax rates on owner-occupied housing. Property taxes paid by businesses, renters and others are excluded from the Tax Foundation’s data.

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