Which statement best describes the function of property taxes?

Property taxes play a crucial role in funding local government services, which is why the statement that property taxes are used for this purpose is the most accurate. These taxes provide essential revenue that local governments rely on to maintain and improve services such as education, public safety, infrastructure maintenance, and local health and social services.

Local jurisdictions assess property taxes based on the value of real estate within their areas. This means that the funds generated through property taxes are directly tied to the local community's need for various public services and development programs, making them a vital component of local governance.

The other statements do not accurately represent property taxes' nature or purpose. For instance, property taxes are not a fixed percentage of the sales price but are instead based on the assessed value of the property. Additionally, property taxes apply to both residential and commercial properties, not just commercial. Finally, while property taxes contribute to community services that can indirectly influence property values, they do not inherently increase property values over time. Instead, property value fluctuations are influenced by a variety of market conditions and external factors beyond just property taxes.