This means that if property tax values go up, the revenue generated by the town’s tax rate also increases.
The revaluation resulted in a 14.56% increase in the tax base for the 2021 fiscal year. This will result in over $1 million dollar increase in revenue for the town for the upcoming fiscal year.
When a tax revaluation is completed, state law requires municipalities to provide a revenue neutral budget for the upcoming fiscal year.
For the 2021 fiscal year revenue neutral budget, the town tax rate was set at $0.3120 per $100 valuation, which is lower than the town’s current rate.
After running a financial model to see what the town’s financial status would be if they used the revenue neutral budget, the model showed that the town would lose $587,000 in that fiscal year, the town manager said.
While the tax revaluation brought in more revenue, the financial impacts of the coronavirus caused major financial losses.
For the 2021 fiscal year, the virus will impact the town’s revenue streams in three ways.
• The tax collection rate will reduce by 3% in the 2021 fiscal year, with a $300,000 decrease in revenue.
• The town will see an estimated $85,000 loss in sales tax. This is due to the lack of sales for goods and services as people stayed at home in order to prevent the spread of the virus.