Lewes could move ahead with a tax break for some homeowners in the coming years.
At a recent town Finance Committee meeting, committee chair Tina Samson floated the idea of a homestead deduction. The proposal would give homeowners who live in their home, instead of using it as a rental property or second home, a discount on their property taxes.
“It reduces every residential assessment by a certain amount of money," she said. "The result is lower property taxes for residents and slightly higher property taxes for second homers and landlords.”
The process would be revenue-neutral, Samson stressed, meaning the total amount of money the city would bring in from property taxes would remain the same, but how much individual property owners pay would change.
“It helps long-term residents, especially seniors, stay in their homes, helps moderate and lower income residents who are most affected by tax increases, and higher taxes for those with greater ability to pay, which is landlords and second homeowners," Samson explained.
There are still questions to be answered, including how many homeowners would qualify. Samson estimates about 37% of homes in Lewes are owner-occupied.
Another question is how a homeowner proves Lewes is their primary residence. Samson suggested looking at what address a property owner uses to pay income taxes, where one is registered to vote, and a person’s vehicle registration.
The next step is for the City Council to empower the Finance Committee to continue studying the idea. That could happen in November. The process of developing a plan could take two years or so.
