What Is Ad Valorem Tax?
Indirect taxes Economics Help from www.economicshelp.org Ad Valorem Tax is a type of tax on property imposed by a country or state. It is used to fund public services, such as schools, roads, and police and fire departments. The term “ad valorem” is Latin for “according to value.” The amount of tax due is determined by the value of the property being taxed. Ad Valorem Tax is typically a percentage of the property’s fair market value, but the rate can vary from one jurisdiction to another. Property owners are typically responsible for determining the value of their property and calculating the amount of tax due. Who pays Ad Valorem Tax? Ad Valorem Tax is typically paid by property owners, but there are exceptions. In some jurisdictions, the tax is paid by the tenant or occupant of the property. In others, it is paid by the seller of the property. In some jurisdictions, the tax is paid by the buyer of the property, while in other jurisdictions, it is split between the buyer and selle