STOP THE GENERAL ASSEMBLY FROM RAISING THE REALTY TRANSFER TAX!
Legislation has been introduced (HB 293) that will raise the realty transfer tax by .28% to fund the Community College Infrastructure Fund for capital construction at all four (4) Delaware Technical and Community College campuses.
In addition, Governor Minner and the Department of Finance, Office of Management and Budget and the Controller General's Office recently released the General Fund Revenue Report which outlines current revenue and examines potential revenue sources that policy makers may want to consider.
The report states that "Despite its position among the highest realty transfer tax rates in the nation, in terms of revenue raising potential, increasing Delaware's RTT could be used to address an immediate budget shortfall." The report states that the cyclical nature of the tax would carry a larger confidence interval than other options.
Members of the Assembly must hear from REALTORS® that this idea is bad public policy and it is certainly bad in today's market.
Real estate transfer taxes and fees are a major burden to buyers and sellers including new entrants in the home market, seniors downsizing who have to pay the tax for the privilege of selling their home, churches and other civic groups and military families transferred to another community who must sell their homes.
The narrow base of property transfer taxes places a larger burden on a small share of the population relative to broader based taxes. New home owners and those "trading up or down" should not be singled out to pay for construction at DTCC.
Real estate transfer taxes and fees have a negative impact on housing costs and, therefore, economic development. Real Estate Taxes are regressive because the tax burden is higher for lower income households.
A household that moves frequently, for whatever reason, does not derive additional benefits or place additional burdens on public services (except for minimal administrative costs) as compared to someone who does not move, and should therefore pay similar taxes.
Using the proposed increase in the real estate transfer tax on a home selling for $150,000 the increase in tax would be an additional $420; on a home of $250,000 it would be an additional $700; at $350,000 another $980 and $1260 for a home sold for $450,000. If a couple retires to the beach, selling a house up state, they will be hit twice with the increase in real estate transfer tax.
LEGISLATORS WILL BE IN DOVER THROUGH MARCH 20TH.
THEY CAN BE REACHED THROUGH THE SWITCHBOARD:
Senate Democrat Offices: (302) 744-4286. Senate Republican Offices: (302) 744-4048.
House Republican Offices: (302) 744-4171. House Democrat Offices: (302) 744-4351.
If you do not know your legislators or would prefer to e-mail them you can find the appropriate information at www.legis.delaware.gov. Please let Charlotte Herbert at DAR's Government Affairs Office (302) 734-4444, ext. 12 or charlotte@delawarerealtor.com know about any response you receive.
