Prior to the change in Michigan laws in 1994 known as "Proposal A", property taxes were calculated by multiplying the State Equalized Value (SEV) of a property by the millage rates in that year. Beginning in 1994, the SEV and a figure called "Taxable Value" were the same number. In 1995 and thereafter, the Taxable Value has been subject to an "assessment cap". This cap is calculated by taking the previous year’s Taxable Value, minus any losses sustained by the property, multiplied by the Consumer Price Index (CPI) or 5%, whichever is less, plus any new additions on the property. This calculation is called the "Capped Value". This Capped Value is then compared to the SEV, and if a transfer has NOT occurred in the previous year, whichever value is less (the SEV or Capped Value) will become the new Taxable Value. If a transfer DID occur on the property, the Capped Value will not apply because the SEV will become the property's new Taxable Value. Click on the link below to see STC Bulletin 15 of 2018 for more information on how the 2017 Inflation Rate Multiplier was calculated.