Farm lands, current use

From the 2024 DOR Tax Exemption Study

84.34.065 - Farm lands, current use Description Productive capacity determines the taxable value of farm and agricultural land in the current use program. Productive capacity is defined as the net cash rental capitalized at a rate of interest charged on a farm mortgage plus a component for property taxes. While market value based on highest and best use determines the taxable value of most other property, farm and agricultural land has a reduced taxable value in Washington. The current use value of the land where the farm owner or employees reside is based on the prior year’s average value of farm and agricultural land in the current use program for the county plus the value of land improvements that serve the residence. Purpose Encourages owners of farm and agricultural land to continue using the land for agricultural purposes. Taxpayer ($ in millions): savings FY 2024 FY 2025 FY 2026 FY 2027 State Taxes $47.014 $48.148 $49.309 $50.513 Local Taxes $139.077 $146.860 $155.095 $163.808 Repeal of Repealing a property tax exemption would not increase state revenues. The repeal exemption shifts the state property tax to the currently exempt taxpayers and reduces the tax burden of other