Homestead exemption nixed

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by Jessica Sabbath

A proposal to give localities the option to reduce real estate taxes for homeowners died Thursday after a powerful push against it from state business organizations.

The proposed constitutional amendment, which passed both state chambers last year, would have given localities the option to exempt 20 percent of a home’s assessed value. The proposal, first brought up by Gov. Timothy M. Kaine during his gubernatorial campaign, was designed to reduce the local tax burden on homeowners after assessments skyrocketed.

It was defeated in the Senate Finance Committee although it had already passed the House of Delegates. If approved by the General Assembly, it would have gone to voters this fall.

The proposal would shift the tax burden to industrial and commercial properties. The business lobby was also concerned that localities may turn to other buisness taxes to make up for lost revenue.

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