SUMMARY OF TAX BASES Referendum Market Value and Net Tax Capacity At the most basic level, there are two types of bases upon which property taxes are levied in Minnesota: referendum market value and net tax capacity State NTC vs Local NTC Tax Bases Two net tax capacity based tax bases: Local net tax capacity tax base for levies by local jurisdictions and the state net tax capacity tax base for the state general property tax. Two State NTC Tax Bases: Commercial‐Industrial and Seasonal Residential Recreational The commercial‐industrial tax base includes the tax capacity of all taxable property classified as class 3 (commercial, industrial, and public utility property) or class 5(1) (unmined iron ore property), except for electric generation attached machinery. The seasonal residential recreational base includes the tax capacity of tier III of class 1c (Ma & Pa resorts over $2.3 million), class 4c(1) (resorts), and class 4c(12) (cabins) except the first $76,000 of market value of cabins has a tax capacity for this purpose equal to 40 percent of its tax capacity. Fully Taxable vs JOBZ Values and Exception Levy Tax Bases Job Opportunity Building Zones (JOBZ) split the local net tax capacity tax base and the referendum market value tax base into two additional tax bases. The taxable net tax capacity that is always taxable is referred to as the “fully taxable net tax capacity.” Likewise, the referendum market value that is always taxable is the “fully taxable referendum market value.” The net tax capacity in a JOBZ that is only subject to the general obligation or school district debt levies is the “JOBZ net tax capacity.” The RMV in a JOBZ that may be subject to the general obligation debt levies is the “JOBZ referendum market value.” Tax Base
Count
RMV
NTC
2
RMV
LNTC
RMV
LNTC
SNTC
3
CI SNTC
SRR SNTC
4
CI SNTC
SRR SNTC
6
FT
RMV
FT+JOBZ
RMV
FT
LNTC
FT+JOBZ
LNTC
2010 Tax Base Values Total Property Tax Levy (LNTC + Ref MV + SNTC)
Total Local NTC Levy
Total RMV Levy
State NTC SRR Levy State NTC C/I Levy
Prepared by the Minnesota Department of Revenue, Property Tax Division
for the Property Tax Working Group - September 20, 2011
$8,168,861,111.00
$6,766,487,321.00
$795,430,301.00
$39,827,786.00
$756,794,819.00 Summary of Tax Bases
1