News From Terre Haute, Indiana

News

January 11, 2014

Officials want time to review tax plans

Two alternatives to eliminating business property tax floated

TERRE HAUTE — Vigo County and Terre Haute officials say they need to learn more about two new proposals that provide alternatives to Gov. Mike Pence’s push to eliminate the business personal property tax.

House Speaker Brian Bosma, R-Indianapolis, last week announced rather than an outright elimination of the tax that provides $1 billion annually to local government and Indiana schools, the GOP caucus supports allowing each county to decide if the tax is dropped, but only for new business and manufacturing equipment.

The plan would also not allow existing businesses to move from county to county to obtain the tax cut.

On Jan. 9, Senate Bill 1 was filed, proposing to reduce the state’s corporate income tax rate to 4.9 percent by July 1, 2019, a measure that would put $132 million annually back into the private sector economy, according to a release from state Senate President Pro Tem David Long, R-Fort Wayne, and Sens. Brandt Hershman, R-Buck Creek and Luke Kenley, R-Noblesville.

It would exempt small businesses from personal property tax liability if a business has less than $25,000 of personal property in a county. That change is projected to exempt up to 71 percent of business property tax filers, according to the release.

The bill would also create an 11-member commission to study the impact of the business personal property tax on Indiana’s economic competitiveness.

Terre Haute Mayor Duke Bennett has spoken out against the elimination of the tax, as it would reduce city revenue by $4.5 million, plus more than $935,000 for the city’s sanitary district. Bennett said Friday he does not yet know details of the two bills.

“Anything that would transition us in and help us grow business, but not at the expense of local government, I can live with,” Bennett said.

The mayor said he is concerned the business tax would simply be shifted to personal income tax. Then the concern will be the income tax is not competitive with other states, the mayor said.

“They just lowered the income tax level at the state level and now they want us to raise it? It almost like the state is just pushing this onto the locals to have to deal with this,” the mayor said. “It is a viscous cycle. You just can’t do that.”

Vigo County could see a more than $3.2 million reduction in revenue with the elimination of the business personal property tax. Vigo County Auditor Tim Seprodi said permitting counties to remove the business personal property tax is akin to an existing incentive already available to counties — a tax abatement.

“Tax abatement does reduce taxes for a period of time, so there is already something in place” to help business, the auditor said.

Seprodi said if county officials decide to eliminate the tax, the revenue must be replaced or local government must reduce services and cut employees.

That, Seprodi said, means increasing income taxes at the county level. Under state law, only the Vigo County Council can implement and raise such taxes. Vigo County’s income tax rate is 1.25 percent, from a combined County Adjusted Gross Income Tax (0.75 percent) and County Economic Development Income Tax (0.05 percent).

The county can raise income taxes up to a maximum of 3.75 percent, but that would be higher than the current state income tax of 3.06 percent, the auditor said. Reducing or eliminating the business personal property tax needs more study, Seprodi said.

Bill Thomas, president of the Vigo County Council and owner of Double Bee Fence Co., said he understands what Gov. Pence “is wanting to do for business. But I am in a position of having to wear two hats,” he said.

“This scares me what it will do to the county,” Thomas said.

Thomas said he would not support an increase of income taxes at the county level. “I don’t think we should raise any tax right now. People are still struggling now to get back on their feet.”

“This will really take a lot of study and brainstorming” on finding a solution to replace any lost revenue from a reduction or elimination of the business personal property tax, Thomas said.

Like Mayor Bennett, Thomas views proposals to eliminate or reduce the business tax as a shift from the state level to county taxpayers.

“We just struggled through the [property tax caps] and now this. We have to wait and see what the state legislature actually decides to move forward with…,” Thomas said.

Reporter Howard Greninger can be reached at 812-231-4204 or howard.greninger@tribstar.com.

1
Text Only | Photo Reprints
News
Latest News
TribStar.com Poll
AP Video
Raw: Easter Morning Delivery for Space Station Raw: Space X Launches to Space Station Man Charged in Kansas City Highway Shootings New York Auto Show Highlights Latest in Car Tech Raw: Obamas Attend Easter Service Raw: More Than 100,000 Gather for Easter Sunday Raw: Students Hurt in Colo. School Bus Crash Raw: Fire Destroys 3 N.J. Beachfront Homes Raw: Greeks Celebrate Easter With "Rocket War" New York Auto Show Highlights Latest in Car Tech Obama Awards Navy Football Trophy Popular Science Honors Year's Top Inventions Raw: Massive 7.2 Earthquake Rocks Mexico Ceremony Marks 19th Anniversary of OKC Bombing Small Reactors Could Be Future of Nuclear Energy Police Question Captain, Crew on Ferry Disaster Raw: Orthodox Christians Observe Easter Rite Drought Concerns May Hurt Lake Tourism Raw: Church Tries for Record With Chalk Jesus Miley Cyrus Still in Hospital, Cancels 2nd Show
NDN Video
Jabari Parker's Top 5 Plays From Duke Career Kourtney Kardashian Is a Bikini Babe More Manpower Than Ever Expected At 4/20 Rally Debunk'd: Miley Cyrus AIDS, Cheeseburgers Cause Cancer, Military Warning Bill Previewing the NBA playoffs Raw: Orthodox Christians Observe Easter Rite My name is Cocaine Raw: Space X Launches to Space Station Lohan Gets Candid About Her Sex List The 2014 New York Auto Show Meet Johnny Manziel's New Girlfriend Chelsea Clinton Announces Pregnancy Funny: Celebrating Easter with Martha Stewart and Friends Man Accuses 'X-Men' Director Bryan Singer of Sexually Abusing Him As a Teenager Man hit with $525 federal fine after he doesn't pay for soda refill Lea Michele & Naya Rivera Feuding? Jabari Parker declares for the NBA draft Singing Nun Belts Out Cyndi Lauper New West, Texas Explosion Video Swim Daily, Throwback Thursday
Parade
Magazine

Click HERE to read all your Parade favorites including Hollywood Wire, Celebrity interviews and photo galleries, Food recipes and cooking tips, Games and lots more.
  • -

     

    March 12, 2010

activity
Real Estate News