What is one of the key features of ad valorem taxes?

One of the key features of ad valorem taxes is that they are calculated based on the assessed value of property. Ad valorem, which is Latin for "according to value," means that the tax imposed is proportionate to the property's value as determined by local assessment authorities. This ensures that property owners pay taxes that reflect their ability to pay, as those with higher-valued properties contribute more to the tax revenue than those with lower-valued properties.

This method of taxation is common for real estate and is intended to provide a fair and equitable means of funding public services, such as schools, roads, and emergency services, based on the value of the property owned. With ad valorem taxes being directly tied to property assessments, they can fluctuate as property values rise or fall in the market, a dynamic aspect that differentiates them from fixed-rate taxes.