Twelve Democrats joined Republicans in the state House on Tuesday to OK a bill rescinding a local real-estate tax that’s proved distasteful to voters.
In 2007, the General Assembly gave counties the option of putting a 0.4 percent land-transfer tax up for a vote of the people. Since then, voters have rejected the tax every time it’s appeared on the ballot, often by overwhelming margins.
The measure — House Bill 92, Repeal Land Transfer Tax — passed the House 78-38. It now goes to the Senate.
A primary sponsor of the legislation, Ashe County Republican Rep. Jonathan Jordan, said voters had sent a clear message by uniformly shooting down the tax hike.
“It’s time to kill this thing,” Jordan said. “Counties don’t want it, citizens don’t want it. Let’s move on and find something else.”
House Majority Leader Paul “Skip” Stam, R-Wake, pointed out that some county commissioners had set the referendum date on days when fewer voters would turn out, such as the Friday before Labor Day. He called the tax “irrational.”
“If you sell a house at a loss, you pay this tax. Much better to tax gains or income rather than a tax purely on a transfer,” Stam said.
Rep. Paul Luebke, D-Durham, defended the land-transfer tax as a way that counties could keep property taxes down.
“There is no reason why we should sit here and deny the people of this state, county by county, the option of putting it on the ballot,” Luebke said.
The Senate, then controlled by Democrats, passed a similar bill in 2008, but it died in a House committee.
David N. Bass is an associate editor of Carolina Journal.