Opinion ID: 1221858
Heading Depth: 1
Heading Rank: 1

Heading: elements of property taxation

Text: Taxes for meeting public expenses are annually determined in a budget set by a particular governing body representing its respective public segment, e.g., state, county, and city levels of government. Property taxes are levied to help provide the necessary revenue to meet the expenditure found in the budget. The power to tax, as well as the method of computing and levying taxes, are controlled by the Constitution and applicable statutes. There are two elements to any property tax system: (1) the tax rate, and (2) the property value. Tax rate is generally reflected in mills, or millage rate. A mill is simply a unit of monetary value equal to one tenth of a cent, or one thousandth of a dollar. Webster's Third International Dictionary, 1434 (1967). A tax rate of 150 mills translates into .15 (15 cents) tax per $1.000. Property value involves actual value and assessed value. Actual value simply denotes the true market value of the property. Assessed value is a valuation placed upon property for the purpose of taxation. Powell v. Chapman , 260 S.C. 516, 197 S.E. (2d) 287 (1973). It is normally a small fractional part of the actual value. These fractional ratios are statutorily provided in § 12-43-220, Code of Laws of South Carolina (Cum. Supp. 1980). See, generally, Article X, South Carolina Constitution. [1] Individual property taxes are determined by multiplying the tax rate (millage) times the assessed value of the particular property. Either of the two elements standing alone is relatively meaningless; only when combined with each other is their true tax impact revealed. In general terms, the appropriate tax rate is reached by dividing the assessed value of the property to be taxed into that part of the budget to be generated by property taxes. The annual county budget must be adopted prior to the beginning of the new fiscal year. County government, for budgetary purposes, operates on a fiscal year running from July 1 through June 30 of the following year. § 4-9-140, Code of Laws of South Carolina (1976). Thus, the new county budget must be prepared prior to June 30. The Lee County Council complied with that requirement by adopting its budget on June 26. It also set the tax rate (118 mills) at that time.