The property tax is the oldest tax levied in the United States and is the only major tax common to all fifty states. It is the main source of municipal and county revenues and primary source of support for local schools. Property taxes vary widely by state and local jurisdiction. The National Association of Home Builders calculates the effective property tax rate as measured by taxes paid per $1,000 of home value by dividing aggregate real estate taxes paid by the aggregate value of owner-occupied housing units within a state. New Jersey has the dubious distinction of imposing the highest effective property tax rate—2.13% or $21.25 per $1,000 of home value. Hawaii levies the lowest effective rate in the nation—0.28%, or $2.84 per $1,000 of value.
