Levy vs. Assessment — What's the Difference?
By Maham Liaqat & Fiza Rafique — Updated on April 29, 2024
A "levy" is a charge or tax imposed by a government on individuals or property for public purposes, while an "assessment" often refers to the process of determining the value of a property, typically for taxation or a specific charge based on benefits.
Difference Between Levy and Assessment
Table of Contents
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Key Differences
A levy typically represents a general charge or tax collected by a government entity to fund various public services such as education, infrastructure, or security. In contrast, an assessment often targets specific properties that will directly benefit from public improvements, such as road construction or utility installations, and the charge reflects the benefit these properties receive.
Levies can be broad, affecting a large group of taxpayers across a community or even an entire country, like sales taxes or income taxes. On the other hand, assessments are usually localized, affecting only property owners in a specific area who are expected to benefit from a local project.
The purpose of a levy is mainly to generate revenue for a wide range of public services, making it a crucial tool for government finance. Whereas, the purpose of an assessment is not only to generate funds specifically for the project at hand but also to ensure that the cost is equitably distributed among those who benefit directly from it.
In practice, levies may be mandatory and unavoidable for all within their scope, such as property taxes or VAT. Meanwhile, assessments require a clear linkage between the property being assessed and the benefit provided by the project, and they often require a formal process to determine the assessment rate or amount.
The imposition of a levy typically does not require a direct benefit to the payer, other than the general benefits of living in a well-funded society. Conversely, assessments specifically charge property owners based on the increase in property value expected from nearby public works, making them more directly tied to personal gain.
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Comparison Chart
Definition
A tax imposed to raise public funds
A charge on property for direct benefits
Purpose
General revenue for public services
Fund specific projects, equitable cost sharing
Scope
Broad, potentially affecting many
Targeted, affecting property owners in a specific area
Benefit to Payer
Indirect, general public services
Direct, specific improvements
Determination
Set by statute or policy
Based on property value and direct benefit
Compare with Definitions
Levy
Can be fixed or variable, often based on income, property value, or purchases.
The levy varies according to the property's assessed value.
Assessment
Often used for infrastructure projects that have direct local impacts.
The city conducted an assessment for flood defense improvements.
Levy
A compulsory charge imposed by a government to fund its activities.
The city council approved a levy on all commercial transactions to fund public transport improvements.
Assessment
Calculated based on improvements and expected increase in property value.
Assessments for the road paving project were determined by the anticipated property value increase.
Levy
Enforced by law and generally unavoidable within its jurisdiction.
All residents must pay a levy for municipal waste management.
Assessment
A specific charge based on the benefit derived from public projects.
Property assessments were increased to fund the new park development nearby.
Levy
Applies broadly to a wide range of subjects, often without direct benefit correlation.
The government imposed a new levy on gasoline to decrease roadway congestion.
Assessment
Requires a clear, demonstrable benefit to the charged properties.
The assessment was justified by the enhanced access to the renovated public library.
Levy
Essential for operational and developmental governmental activities.
The annual property tax levy funds local schools and emergency services.
Assessment
Typically localized, affecting only those who benefit directly.
Only homeowners along the new sewer line will face an assessment for its installation.
Levy
Impose (a tax, fee, or fine)
A tax of two per cent was levied on all cargoes
Assessment
The act of assessing; appraisal.
Levy
Enlist (someone) for military service
He sought to levy one man from each vill for service
Assessment
An amount assessed, as for taxation.
Levy
An act of levying a tax, fee, or fine
Police forces receive 49 per cent of their funding via a levy on the rates
Assessment
The act of assessing or an amount (of tax, levy or duty etc) assessed.
Levy
An act of enlisting troops
Edward I and Edward II had made substantial use of the feudal levy for raising an army
Assessment
An appraisal or evaluation.
Levy
To impose (a tax or fine, for example) on someone.
Assessment
The act of assessing; the act of determining an amount to be paid; as, an assessment of damages, or of taxes; an assessment of the members of a club.
Levy
To impose a tax, fine, or other punishment on (a person or business).
Assessment
A valuation of property or profits of business, for the purpose of taxation; such valuation and an adjudging of the proper sum to be levied on the property; as, an assessment of property or an assessment on property.
Levy
To enlist or conscript into military service
Levy recruits.
Assessment
The specific sum levied or assessed.
Levy
To declare and wage (a war).
Assessment
An apportionment of a subscription for stock into successive installments; also, one of these installments (in England termed a "call").
Levy
To confiscate property, especially in accordance with a legal judgment.
Assessment
The classification of someone or something with respect to its worth
Levy
The act or process of levying.
Assessment
An amount determined as payable;
The assessment for repairs outraged the club's membership
Levy
Money, property, or troops levied.
Assessment
The market value set on assets
Levy
To impose (a tax or fine) to collect monies due, or to confiscate property.
To levy a tax
Assessment
The act of judging or assessing a person or situation or event;
They criticized my judgment of the contestants
Levy
To raise or collect by assessment; to exact by authority.
Levy
To draft someone into military service.
Levy
To raise; to collect; said of troops, to form into an army by enrollment, conscription. etc.
Levy
To wage war.
Levy
To raise, as a siege.
Levy
(legal) To erect, build, or set up; to make or construct; to raise or cast up.
Levy
The act of levying.
Levy
The tax, property or people so levied.
Levy
The Spanish real of one eighth of a dollar, valued at elevenpence when the dollar was rated at seven shillings and sixpence.
Levy
A name formerly given in Pennsylvania, Maryland, and Virginia to the Spanish real of one eighth of a dollar (or 12½ cents), valued at eleven pence when the dollar was rated at 7s. 6d.
Levy
The act of levying or collecting by authority; as, the levy of troops, taxes, etc.
A levy of all the men left under sixty.
Levy
That which is levied, as an army, force, tribute, etc.
Levy
The taking or seizure of property on executions to satisfy judgments, or on warrants for the collection of taxes; a collecting by execution.
Levy
To raise, as a siege.
Levy
To raise; to collect; said of troops, to form into an army by enrollment, conscription, etc.
Augustine . . . inflamed Ethelbert, king of Kent, to levy his power, and to war against them.
Levy
To raise or collect by assessment; to exact by authority; as, to levy taxes, toll, tribute, or contributions.
If they do this . . . my ransom, then,Will soon be levied.
Levy
To gather or exact; as, to levy money.
Levy
To seize property, real or personal, or subject it to the operation of an execution; to make a levy; as, to levy on property; the usual mode of levying, in England, is by seizing the goods.
Levy
A charge imposed and collected
Levy
The act of drafting into military service
Levy
Impose and collect;
Levy a fine
Levy
Cause to assemble or enlist in the military;
Raise an army
Recruit new soldiers
Common Curiosities
What happens if you don't pay an assessment?
Non-payment of an assessment can lead to penalties similar to those for unpaid taxes, including liens against the property.
How is the amount of an assessment determined?
It's typically based on the estimated increase in property value due to the public project and the direct benefit to the property.
Can both a levy and an assessment affect the same property?
Yes, a property might be subject to both a general levy, like property taxes, and a specific assessment for local improvements.
How do levies and assessments affect property values?
While levies may not directly affect property values, assessments can increase them by funding improvements that make areas more desirable.
What is the main difference between a levy and an assessment?
The main difference is that a levy is a broader tax for general revenue, while an assessment is a targeted charge for specific benefits derived from public improvements.
How often are assessments applied?
Assessments are applied as needed, usually when a new public project that benefits specific properties is initiated.
Why might a government choose to levy a tax instead of making an assessment?
A levy can raise funds more broadly and is not limited to properties benefiting from specific projects, making it more suitable for general public services.
What legal protections exist for taxpayers regarding levies and assessments?
Taxpayers have rights to receive notice about levies and assessments, to understand how they are calculated, and to appeal them if they are incorrect or unfairly applied.
Are levies optional?
No, levies are mandatory taxes imposed by governments and must be paid by those within the jurisdiction.
Can an assessment be contested?
Yes, property owners can usually contest an assessment if they believe it is unfair or the benefit to their property is inaccurately calculated.
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Written by
Maham Liaqat
Co-written by
Fiza RafiqueFiza Rafique is a skilled content writer at AskDifference.com, where she meticulously refines and enhances written pieces. Drawing from her vast editorial expertise, Fiza ensures clarity, accuracy, and precision in every article. Passionate about language, she continually seeks to elevate the quality of content for readers worldwide.
