What Is a Mill Tax?
A Mill Tax is more commonly known as a Mill Levy or Mill Rate and is the rate at which property taxes are determined. The Mill Tax Rate is a variable rate meaning that it is not a set rate from town to town and can change by election to cover a town's expenses and improvements.
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What is a Mill Tax?
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The word mill comes from millage, which by definition in the dictionary means "the tax rate, as for property, assessed in mills per dollar." People who own real estate are required by law to pay taxes on property. This tax is calculated by using the mill rate. Property tax is calculated by taking the assessed value of a property, multiplying it by the mill rate and dividing it by 1,000.
What is the Mill Tax Rate?
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The mill rate is set by a state's government, a town's government and a community's voters. The Mill Rate varies among towns and states and can change, by vote, to cover expenses such as building new schools, improving infrastructure and maintaining a town's facilities. To find out a particular town's mill rate, visit the local assessor's office.
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Does Everyone have to pay a Mill Tax?
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Mill Tax is strictly for people who own real estate. Property taxes were created as a support mechanism for towns. Everyone who owns real estate is responsible for property taxes that help maintain the surrounding community.
Avoiding the Mill Tax
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The Mill tax rate is voted on by the local electorate. There is no way around the Mill Tax rate. Every person who owns real estate must pay property taxes.
Does the Mill Tax Change Often?
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A change in the Mill Tax rate must be voted on as it does change frequently. If a community wants to make improvements such as add a park, refurbish Main Street or build a new school, typically a Mill Rate increase will make its way to the ballot to cover the expense of such improvements. Likewise when the improvements have been made and paid off, the Mill Rate can decrease again.
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