From the Indianapolis Star:
A statewide coalition of 16 groups representing local governments, schools, libraries and police is pushing back harder against bills advancing through the legislature that they say would cut public services and reduce property tax revenue they depend on.
Indiana House and Senate Republicans are pushing separate proposals to cut the personal property taxes businesses pay on equipment — a major source of tax revenue for these local government bodies amounting to an annual total of $1 billion.
Gov. Mike Pence also has made the tax cut a centerpiece of his legislative agenda.
This morning, the House voted 63-33 to approve its business tax cut proposal, House Bill 1001. It allows counties to exempt any new business equipment from property taxes. That measure now moves to the Senate.
The Senate’s bill — considered more modest — is on today’s schedule for a final vote. Senate Bill 1 would eliminate the tax only for businesses with less than $25,000 worth of equipment. That would free 70 percent of Hoosier businesses from the tax. Because those businesses pay very little tax now, the proposal would cost local governments about $24.1 million in revenue.
Coalition members consider neither option acceptable because they do not provide any mechanism to replace the lost revenue.
“We are 100 percent unified on this issue,” said Matt Greller, executive director and CEO of the Indiana Association of Cities and Towns during a press conference today announcing their “Replace Don’t Erase” coalition.
“I think we all see this as the most significant piece of revenue loss coming down the road that local governments have faced in the history of Indiana,” said Greller.
Representatives of the coalition said cutting the business personal property isn’t necessarily wrong, but they don’t believe it should be done without replacing all of the revenue. They also worry that the Senate’s proposal is just the first step in moving toward a total elimination of the tax.
Even though neither bill includes provisions for any revenue replacement, legislative leaders and the governor say they want to do that.
...
http://www.indystar.com/story/news/2014/01/30/local-officials-say-replace-dont-erase-biz-tax/5058589/
