A high percentage of legislators and governors have expressed a desire to cut property taxes, which are the least popular of the three major tax sources — income, property and sales.

Several states — notably South Carolina, South Dakota, and Wisconsin — have financed large rollbacks of property taxes with state revenues. Many states have financed more selective property tax relief. Voter initiatives to limit property taxes have been a major factor in the fiscal policies of Oregon and potential initiatives have encouraged consideration of property tax relief in other states.

Taxes Affecting Economic Competition

Concerns over making or keeping states economically competitive have been a major factor causing state tax changes over the past decade. The changes affecting business taxes are covered in detail in “Interstate Economic Competition and State Tax Policy.” Competitive concerns have also led states to abandon their estate and inheritance taxes — except for the taxes that can be 100% credited against federal estate taxes. Extra state taxes remain in only a few states.