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Lawmakers Consider Solutions To Big Box Store Property Taxes

Bloomington, from of Best Buy store

Photo: Dan Goldblatt

Big box stores like Best Buy are paying less in property taxes than before.

Lawmakers have developed what they hope is a solution to growing concerns over property tax bills for big box stores like Walmart, Meijer and Walgreens. Groups on both sides of the issue say they won’t know the effect of that solution until after the General Assembly’s session ends.

Counties across Indiana are losing money as property tax assessments shrink for big box stores. Property taxes for these national chains went down after a number of court rulings said they could determine their tax bill by comparing an individual store to any other store in a general retail market.

Critics have argued this is an apples-to-oranges comparison. A new House bill seeks to change that broad comparison by using what’s called market segmentation, which some say could push assessors to consider a number of factors.

“Who are the likely users, similar property, what is the traffic on the road outside of it, what is the income of the population surrounding a store?” says Indiana Association of Counties lobbyist Ryan Hoff.

But there’s no strict definition for what market segmentation means and the bill doesn’t specify which factors should be weighed. It leaves that job to Indiana’s Department of Local Government Finance, or DLGF. Indiana Chamber of Commerce Vice President Bill Waltz says, if the bill is passed, it will be a long process.

“Frankly, I’m not sure anybody knows exactly what it means but we’re willing to see how it works out,” Waltz says, adding that most of the important details will be determined first by the DLGF, and then the tax courts.

A Senate committee approved its version of big box assessment legislation Tuesday. A House committee will consider its own bill later this week.

Experts discussed the complications of this issue in September on NoonEdition.

Want to contact your legislators about an issue that matters to you? Find out how to contact your senators and member of Congress here.

  • lastcamp2

    Indiana policy is to protect business from paying a fair share of the cost of government. First, they get tax abatements when they build, second, they locate in a TIF district so they pay taxes to themselves, third, they pay lower and lower business taxes, fourth, the public pays for their infrastructure, and now they connive to pay less and less in property taxes. And there is no doubt stuff I am missing.
    But we all know that when businesses make enough money, some of it “trickles down” to the rest of us. Right? That is one of the fundamentals of neoliberal economic theory.
    Of course business believes it never, ever makes “enough.” And always pays too much in taxes.

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