A common fallacy is that property taxes rise and fall with the assessed value of our house. That is not true. Many states have that kind of tax system, but not Washington.
Washington uses a budget-based system. Each year the government sets a new budget with a new property tax rate. That rate can collect no more property tax money than collected in the prior year, plus 1 percent. That is true no matter what happens to housing values.
Imagine the property value of the whole city as a pie. The assessed value of my house is only used to decide the size of my slice of that pie. Then the size of that slice of pie is used to decide my share of the total property tax pie. That’s how much tax I pay.
If the value of every property doubled, our property taxes would not change. If the value of every property was cut in half, our property taxes would not change either. In both cases the millage rate would change to compensate for the change in property assessed values, but the government would not get any more or less money.
