What#039;s the plan really all about?

Published 12:00 am Saturday, August 9, 2003

Senior citizens will still get the exemptions that they have been accustomed to in the past. Azbell said that the state retained an exemption for those 65 and older, which cuts property taxes to zero for seniors.

Alabamians are currently paying one of the lowest property taxes in the country. Even if the tax proposal passes, the state will still be paying one of the lowest taxes in the country

&uot;We're still going to be well below the Southeastern average and our property taxes will be much lower than all of the surrounding states,&uot; Azbell said. &uot;When this plan is fully implemented, our property taxes are going to be half the national average and will be less than 70 percent of the Southeastern average.&uot;

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The national average is about $880 per person and the Alabama average is $300. If the tax is approved it will increase to $405 per person.

Mortgage and deeds

The governor's plan also is expected to generate $45 million with increased taxes on mortgages and deeds.

Currently mortgage fees run $1.50 per $1,000 and deed fees are one mill or $1 per $1,000. With the new taxes, the mortgage fee will increase to $3 per $1,000 and the deed fee will go up to $2 or two mill.

Tax on repairs

Currently when individuals have repairs performed on their car or truck, such as the installation of an alternator, they are given a bill divided into two parts. The first part of the bill is for the alternator with sales tax included. The second part is a bill for the labor that isn't taxed. If the proposed plan is passed, customers will be charged sales tax for the part and labor.

&uot;This tax only applies if you have something installed,&uot; Azbell said.

The tax also will apply to service such as oil changes. For example, the average price of an oil change is $20. If a person gets his oil changed four times a year at $20, he will pay an extra 80 cents per visit or $3.20 for the year.

Home repairs also will be taxed under the proposed plan. According to David Perry, the state's fiscal analyst, taxes will not be charged on any permanent work performed on a home such as a room addition, a new roof or getting an air conditioning unit replaced. Only repairs to nonnpermanent fixtures that could be taken with an individual when they move such as work on a refrigerator will be taxed.