Question

Newly acquired property to have a maximum basic tax levy of 1%.

a) Proposition 1
b) Proposition 13
c) Proposition 18
d) Property Taxation Cap Act

Answer 1

The provision capping the maximum basic property tax levy on newly acquired property to 1% is outlined in Proposition 13, which was passed in California in 1978. The correct option is (b).

Step-by-step explanation:

The provision that newly acquired property should have a maximum basic property tax levy of 1% is associated with Proposition 13, passed in California in 1978.

This proposition established a cap on real estate tax at 1 percent of the cash value of property and limited the frequency of reassessment of properties for taxation purposes, only allowing reassessment when a property is sold.

This legislation set a precedent that was followed by other states, putting constraints on the ability of local governments to increase property tax revenue even when property market values rise significantly.