The Board of Finances sets the Mill Rate for the Town every year. The mill rate is usually set in Spring, after the budget is finalized. The Mill Rate is based on the approved budget, estimated non-tax revenues and the Grand List.
It is calculated based on the following formula:
Mill Rate= Current Tax Levy divided by Net Taxable Grand List
Example: $159,000,000 (Tax Levy) / $4,300,000,000 (Net Taxable Grand List) = 0.03698 (Mill Rate)
Mill Rate is most commonly expressed as tax dollars per $1,000 of assessed value. In the example above, that would be 36.98 mills (0.03698 x 1000).
Tax Levy is the annual budget approved by the Municipality minus other non-tax revenues (such as state grants, user fees, investment income, etc.).
Net Taxable Grand List is the total adssessed value of all taxable property (real estate, motor vehicles and business personal property) as determined by the Assessor. The Net Taxable Grand List equals the Total Gross Grand List minus allowable exemptions.
The mill rate calculation as stated above is a simplified version of the actual calculation. Other factors which influence the mill rate calculation include the Tax Collection Rate (whihc estimates uncollectible tax revenues), abatements and tax credit adjustments.
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