TAX NEWS - 2010

Rhode Island Tax: Tiverton's tax rates in flux

TIVERTON — Homeowners will pay a little less than expected on their property taxes this year, but they'll owe more for their cars.

The tax rate for the 2011 fiscal year is $15.35 per thousand dollars of assessed value, Town Administrator James Goncalo confirmed after talking with state financial officials. That's a nickel less than previously thought, meaning the owner of a $300,000 home will save $15.

However, many residents will face a sharp increase in the excise tax collected on motor vehicles.

The General Assembly recently decided to allow cities and towns to lower the excise tax exemption. Previously, vehicle owners were not taxed on the first $6,000 of value; that cap has been lowered to $500.

Tiverton is expected to collect an additional $106,000 due to the change. This year's property tax rate was set before the General Assembly ruled on the excise tax, and there had been some discussion about refunding a portion of property taxes if the excise tax threshold was lowered. But tax bills will be mailed out next week, and the Town Council decided to instead deposit any surplus in the town's general fund.

Councilor Jay Lambert expressed concern over Tiverton's rising property taxes, which increased from $14.35 per thousand last year. Lambert said neighboring communities have lower property tax rates.

"At some point we're going to have to address the reality we can't keep up with this cycle," said Lambert.

Council President Donald Bollin told Lambert that Tiverton ranks 19th out of 36 communities in Rhode Island for property taxes.

"We live in Rhode Island," said Bollin. "We choose to live in Rhode Island. If you're looking for a lower tax rate, the option is to move to Massachusetts."

Councilor Louise Durfee said a study conducted by the Rhode Island League of Cities and Towns shows that Tiverton is undertaxing based on its current economic structure.