Farmers to continue to receive tax savings

Wednesday, December 26, 2007

Property tax time is here again.

From now to the new year people in local counties will be mailing checks or making stops at their collector's office. And like other business owners, farmers will have to pay tax on their land.

But in Missouri farmers pay a much lower rate of property tax on their land than do most business owners and homeowners.

Taxes on agricultural land are assessed based on the land's productive value, not on its market value, like residential and commercial property. Farm land is assessed at 12 percent of its productive value, residential at 19 percent of its market value and other property at 32 percent of its market value.

In the end that means big savings on yearly taxes for farmers. Productive value is typically about 23 to 25 percent of the market value of a piece of farmland, said Bruce Davis, chairman of the Missouri State Tax Commission.

With a recent tax commission vote, Missouri farmers will continue to see those same savings. The three-member commission voted 2 to 1 earlier this month against a recommendation raising the baseline by which land's productive value is assessed, despite a report by the University of Missouri's Food and Agricultural Policy Research Institute which showed productive value has risen in past years.

Gov. Matt Blunt urged to commission to vote "no" to the increase, and farm groups praised the decision, saying an increase would hurt farmers who are already dealing with increasing input costs.

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