City of Detroit launches new online estimator tool that demonstrates property tax cut for 97% of homeowners under proposed Land Value Tax Plan

2023
  • Homeowners can enter an address or parcel number to see estimated property tax cut
  • Tool shows an estimated dollar amount a homeowner would save under the LVT plan
  • Mayor shared and demonstrated the tool with residents first during a community meeting

The City of Detroit has launched a new online tool for homeowners to estimate their property tax cut under the proposed Land Value Tax Plan. Under the plan, residential homeowners will see an average 17% cut in property taxes. 97% of homeowners will see tax savings and none will have an increase.

To use the online tool, homeowners would need only an address or parcel number to see an estimate of what their 2023 taxes would have been under the LVTP. Once an address or parcel number is entered, the LVTP tool shows a homeowner’s assessed and taxable values, the current 2023 taxes (summer and winter bills combined, not including solid waste fee) and the estimated LVTP savings. 

Mayor Duggan first shared the tool with residents during his community meeting in City Council District 1 last week. During a demonstration of the tool, many homeowners shared their address and were able to see an estimate of what their 2023 property tax savings would have been under the LVTP.

The Land Value Tax Plan Estimator Tool is online at www.detroitmi.gov/LandValueTax

Attached are samples of the estimator tool on homes including one within an NEZ (Neighborhood Enterprise Zone) and a home with a HOPE exemption.

  • The estimates are based on the Office of Assessor data as of June 30, 2023. Your tax bill may vary if there have been any adjustments or changes since then.  
  • Estimated savings in 2023 will not be the same savings estimates if the LVTP goes in to affect in 2025. 
  • These samples are not tax bills, only estimates. 
  • Actual taxes owed will be sent through City of Detroit official property tax notices.
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About the Land Value Tax Plan 

Detroit’s Land Value Tax Plan is a way for Detroit voters to decide whether to cut homeowners’ property taxes by an average of 17% and pay for it by increasing taxes on land, abandoned buildings, parking lots, scrapyards, and other similar properties. Under the plan, Detroit’s millage for operations would be cut by 14 mills, from 20 mills to 6 mills for all taxable property.  That cut applies to apartments, retail stores, office buildings, homes, and land. 

Land values in Detroit are a fraction of those in surrounding suburbs, which enables speculators to cheaply purchase and hold land. Doubling the tax rate on land increases the tax bills on land. However, homeowners—whose land value is less than 5% of their home value—will only see a small increase from the land tax. Combined with the 14 mill decrease from the City operating millage, 97% of homeowners will see property tax savings and none will see an increase in taxes from the LVTP. 

What’s wrong with the current property tax structure in Detroit? 

  • Michigan’s current municipal tax structure is broken and creates an unfair tax burden on homeowners and small businesses in some communities.  
  • The current system also unfairly rewards land speculators, discourages investment and improvements while saddling homeowners with a growing tax burden. 
  • As some municipalities have lost residents and vacant lots have increased, the tax burden on property owners has increased, which is why the Land Value Tax Plan is necessary. 

What about residents who own side lots? 

No homeowner will get an overall tax increase if they own 4 side lots or less.  The average bill on a side lot will go up about $30 a lot, from $25 to approximately $55.  The average homeowner will get a tax cut on their house that is much larger than that.  If you are the exception where the increase in your side lot tax is more than the tax cut on your home, you will receive a credit that caps your overall tax.  You will have no overall tax increase as a result of the Land Value Tax. 

What about residents with NEZs? 

If you have a NEZ abatement, you can keep that abatement until your NEZ expires.  You will then automatically receive the benefit of the permanent Land Value Tax break. 

What about urban farms and community gardens? 

Qualified urban farms, community gardens, and community spaces will not be affected by the Land Value Tax.   

What’s the timeline for the Land Value Tax Plan? When might residents see a cut in property taxes? 

City officials will continue public engagement on the LVTP as the measure works its way through the State legislature. If the plan is passed at the State level and signed by the governor, City Council would then decide if residents should vote on the measure which could then be placed on the general election ballot in November 2024. The LVTP would then first take affect with the summer 2025 levies. 

Find more information and FAQs about the proposed LVTP at https://detroitmi.gov/LandValueTax.