Real Estate Transfer Taxes
Issue Overview: Over the last number of years, Delaware Technical and Community College has seen growth in the number of students attending their campuses in all three counties. This has placed a strain upon the various structures and practical "labs" used in the education and training of students in the technical fields, such as nursing and automotive repair. To keep pace with the growth, DelTech is seeking to raise the state's realty transfer tax on all real property sales from the current 3 percent to 3.28 percent, with the extra 0.28 percent going toward DelTech's capital program. All real estate sold would be assessed the new rate, if this bill were to pass.
NFIB remains concerned because this is a tax increase and is paid at the time of settlement, which means it cannot be absorbed into the mortgage. It will also make Delaware one of the highest transfer taxes in the nation, if not the highest. It will also increase the costs of expanding business if you need a new building or larger space, and in some cases, this extra 0.28 percent cost could make the real estate transaction prohibitive.
Issue Status: HB293 was assigned to the House Education Committee awaiting a hearing. It is also believed that once the Education Committee has taken action, the bill must be assigned to the House Revenue and Finance Committee, because of the tax implications.
