Proposition 2 1/2 is an initiative petition adopted by voters in Massachusetts in 1980.

The principal features of Proposition 2 1/2 are related to the total amount of property taxes that a city or town can raise each year. It contains 2 limitations on the amount of property taxes to be raised:

• The property tax levy ceiling (the amount raised) can never exceed 2 1/2 percent of the full cash value of all taxable property in the city or town.
• The property tax levy limit cannot be increased more than the 2 1/2 percent over the prior years levy limit without voters' approval to override the cap.

The levy limit provisions of Proposition 2 1/2 affect the total amount of taxes to be raised by a city or town. It does not apply to an individual tax bill. Whether the tax rate for a community will increase or decrease from the prior year will depend upon the levy decided upon by the community. It also depends on whether property values appreciate, depreciate or remain steady in the particular community.