business

business

In the kind of real-world scenarios the private sector faces every day, tax rates make a difference.

Why Tax Rates Matter

The Dallas County Commissioners Court just decided to keep their three county taxes flat for Fiscal Year 2018. But, as we know by now, keeping tax rates “flat” in our current economy means an increase in the amount of tax you pay.
The combined county, school equalization, and Parkland Hospital taxes mean that Dallas citizens now pay almost three times (2.76) the Collin county tax rate. The total Dallas County tax will remain $.531771 per hundred dollars in valuation. The Collin County tax will be $.192246 per hundred dollars.
You can see how extreme these differences are when you apply them to the kind of real-world scenario the private sector economy faces every day.
For instance, if a private development company wants to find a home for a new $100 million office park, choosing to build in Dallas County would mean a tax burden of more than a half million dollars per year. The Collin County tax, on the other hand, would be less than $200,000.
That decision would cost that company $300,000 per year.
But the dramatic difference in tax burden doesn’t end there: our cities are also making very different decisions when it comes to taxation. While our largest city, Plano, has a current tax rate of $.4686 (and has scheduled a decrease for FY2018), the City of Dallas has a tax rate of $.7825.
That means, for that same $100 million commercial facility, choosing to build in Dallas would add another $300,000 to their tax bill.
That’s a total difference of more than $600,000 each and every year.
For a $200,000 house, the difference is more than $1,300 per year. That’s real money that your average homeowner could be using to buy groceries, fix the car, or build a business.
These theoretical examples are helpful, but not necessary, to understanding the difference taxes make. Really, it’s as simple as asking why people choose to live here, or looking out your window as you drive through the Collin County growth corridor.