Introduction Taxes levied on property acquired in form of land and buildings are a huge source of revenue for local government in U.S.A. The value to be taxed is resolved by an evaluator according to the market worth of the property. Avoiding tax is taken to be a criminal offence in America and every owner of property is required to pay to the state some money in form of tax in regards to his property. Property can be taken to be land, immovable property such as buildings or movable properties. The tax imposed on property varies in different countries and jurisdictions and this paper will focus on how property tax works in U.S.A (Karp and Klayman, 2003). Origin Of Property Tax According to Galaty and Allaway (2001), property tax dates back during the colonial times at the beginning of the Revolutionary War. During this time, the colonies had come up with different types of taxes which included capitation taxes, levied mostly on slaves and the male adults at a certain fixed rate; property taxes levied on enumerated items and according to their worth; faculty taxes levied on traders and tariffs imposed on imported or exported products. During the war, there were complains that the taxes imposed were unfair especially property tax which was not taxed as per the value of the property but as per acre basis which favored rich land owners. It was not until the end of the war that the complaints were heard and most states started to levy taxes uniformly. Property tax began being levied on the property itself and not on the occupancy of the property owner (in rem). Basics of Property Taxation In order to further understand the topic, it is important to go over the basics of what property tax really entails. Since way back, imposing taxes on properties has been met with a lot of resistance from property owners. The State on the other hand relies heavily on this tax revenue imposed on the property as it serves as a major source of its income to plan their budget. It is the role of the local and state government to collect taxes on property (Sarah, 2009). In most states in USA, the tax levied on real estate is based on the value of the property and its ownership. The tax is levied on a certain tax rate of the given value of the property. Individual property tax is imposed in many states where the value of private properties owned inside the borders of the state is assessed on a yearly basis. The personal property in this category includes all objects of value such as vehicles and boat registration fees. Only household goods are exempted from this kind of tax. Calculating Property Tax The rate of property tax is calculated on a percentage or permille or millage rate. As earlier mentioned, tax on property in U.S.A is collected by the local government at both the county and municipal level. Rates vary between 0.2% and 4% depending on the state in which the property is situated in. The tax assessment officer, appointed by the local government assesses the property which is categorized into two categories. The value of the property can either be based on its improvement or the Land value itself. To compute the duty to be levied on the assets, the calculated value is proliferated by the mill rate and then it is divided by a thousand.