In January, 2008 Florida voters passed a significant reduction in residential property taxes and these changes have brought the discussion of Homestead Exemption and tax assessment caps to the forefront of the news. An important aspect of this issue, from an economist’s point of view, concerns whether the changes in the property tax and its exemptions are equitably administered and how changes might favorably or unfavorably affect different groups of taxpayers.

This research will estimate regression models using data on 176,222 individual households to examine which groups are most adversely affected by changes in Florida’s property taxes and which homeowners benefit most from changes in the Homestead Exemption and assessment cap initiatives. Previous scholarly literature has not examined these issues empirically. Ours will be the first study that estimates econometric models using data on individual homeowners’ property taxes combined with household demographics.

These models will provide information on the impact of changes in the Florida property tax on specific groups of homeowners. We will find out whether the benefits arising from changes in the tax structure are shared equally (or disparately) across different household types. These results may be useful to policy makers interested in the economic impact of the new proposals