What does “ad valorem” mean?
Ad valorem is a Latin term meaning “according to value.” Taxation according to value is one of the oldest forms of taxation. Historically, it was designed to distribute the costs for the common defense among landowners. The more land that one owned, the more that owner had at risk to invaders. Therefore, that land owner paid more for the defense of that land. In modern times, it is a way of distributing the cost of operating the government and providing services among the citizens of the county based on the value of the property owned in that county.
