CHICAGO - After a whirlwind three-month legislative session, Indiana lawmakers Friday approved sweeping property tax reform legislation that will reduce residential property taxes by 25%, require referendums on local borrowing plans, and raise the state sales tax.

Property tax revenue will decrease by roughly $1 billion annually through a series of so-called circuit-breaker property tax caps, which cap a homeowner's property tax bill at no more than 1.5% of the assessed value of the house and 1% after 2010; rental property bills at 2.5% and 2% after 2010; and commercial bills at 3.5% and 3% after 2010.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.