Tom’s Opinion: Is It Time to Abolish The Property Tax In Montana?

North Dakota residents have announced that they are going to try to eliminate the personal property tax for their state. This is something I’ve been talking about on the radio for years. There’s something wrong with the “American Dream” of homeownership, if you don’t own the land you live on. You work your whole life, pay off your home loan, pay insurance, but miss a couple of tax payments, and you will be living in the church basement. I don’t think that’s the kind of “American Dream” our founders had in mind.

What Would The Loss of Property Taxes Mean to Montana?

There is no question that the elimination of the property tax would put a strain on the services that state government provides. And, the question that always arises, from both parties, is, “How will we make up for that loss in revenue?”

In my opinion, that’s the wrong question to ask. The right question should be, “What can we cut, and where can we save, to give this benefit to our citizens?” Many citizens have stated that they would be willing to vote for a sales tax if, either property or income tax was eliminated. I don’t think I can favor trading one tax for another.

It would be hard to make a case that Montanans are not taxed enough already.  In addition to property taxes and state income tax that are already in existence, you can add the bed tax, cigarette tax, and gas taxes. And if that’s not enough, then there’s a variety of natural resource taxes, including the coal-severance tax, electrical-energy tax, federal forest receipts, metalliferous-mines tax, oil- and natural-gas production tax, resource-indemnity tax, U.S. mineral royalty and wholesale energy tax. It’s probably easier to list what isn’t taxed in Montana than what is.

What Would Tom Do?

If I were king of Montana here is my formula for the elimination of the property tax. First, it would be too much of a shock to the economic system to abruptly cut off that revenue, with one large chop. I would use a 5-7 year plan and slowly reduce property taxes. More money in people’s pockets should increase spending and produce more corporate and business taxes.

The eventual repeal of property taxes would make our state a more desirable place to live, start a business and own property. That should result in more businesses moving to Montana and more working taxpayers in our state. And yes, those taxpayers would require government services. However, the overall taxpayer base paying into the tax sources listed above, could handle that, over time.

I would also look for what every politician promises, during every campaign, but never delivers. Phasing out overlapping programs and tax funded services that have a low return on investment. In short, there are always ways to reduce waste, without sacrificing needed services.

Last but not least, Montana needs to become a right-to-work state. We’ve already seen what can happen with union control of the public sector in Wisconsin. Montana is poised to go down that same road if we don’t make a change soon. Indiana became the 27th state to join the right-to-work community. We should be hard at work electing candidates who want to make Montana number 28.

Who would still pay property taxes under Tom’s plan?

Montanan’s, with a paid mortgage, who occupy their residence, for at least 8 months of the year, would be exempt from any property taxes. Any property that earns income would still be subject to some property tax based on the income vs. expense of the operation of the property. Rental property would still be taxed because it produces income. The same would be true of farms and ranches. However, they would not be taxed at current rates.  The whole idea is to put more dollars in the hands of taxpayers, and less in the pockets of government.

What About Uncle Sam?

Currently we are getting about $1.75 in tax dollars back from Uncle Sam for every dollar we send in. It would sure be nice to reverse those numbers. Unfortunately, the only way that will happen is with more taxpayers making us less dependent on government. The more dependent we are on government, the less power we hold, and the less say we have in the running of our state. It would be very gratifying to tell the Fed’s to get lost — we don’t need ya!

Some Final Thoughts

No question that the nation is changing. Wisconsin fired the first shot across the bow of government and union control. They are re-taking control of their state based on the needs of those who reside within their borders. It would sure be nice to do the same thing here.

Montana has a long and proud history, along with its pioneer spirit. There are companies in Bozeman, and Livingston that were in business when Indians were still attacking wagon trains. We’ve survived countless wars, a national depression, at least 10 recessions, droughts, fires, harsh climate and our resilience is still strong. We will survive no matter what, but let’s all join together in deciding our state’s destiny.