What significant change did Proposition 13 bring to California's property tax system?

Proposition 13, passed in 1978, significantly changed California's property tax system by capping the property tax rate at 1 percent of the assessed value of a property. This means that no matter how high a property's market value may rise, the tax assessed cannot exceed 1 percent of its value at the time of purchase, plus a maximum of an annual increase of 2 percent for inflation. This provision aimed to provide a measure of stability for homeowners and reduce taxes in the state during a period of high inflation and rising property values.

By establishing this 1 percent cap, Proposition 13 fundamentally altered how property taxes are calculated in California, limiting the financial burden on property owners and providing predictability in tax bills. Its impact is still felt today, influencing not just individual tax bills but also broader fiscal policies and housing market dynamics in the state.