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Legislators Reach Compromise On Business Property Tax

By Brandon Smith

Posted March 12, 2014

Speaker Brian Bosma says House and Senate GOP leadership have agreed in principle to a final deal to reform the state's business personal property tax. The compromise leaves the tax almost entirely in the hands of local governments.

The original House plan for business personal property tax reform would have allowed local governments to eliminate the tax on new equipment purchases.

Speaker Brian Bosma says that will remain in the bill. The original Senate plan eliminated the tax statewide on small businesses. Bosma says that will now become a local option as well. And he notes all of the business personal property tax adjustments wouldn't go into effect until July of 2015.

"Some are still uncomfortable about it," Bosma said. "It will give the legislature time to look at whether replacement revenues need to be adjusted, what they should be and I think it's just a prudent approach."

Senate President Pro Tem David Long says the bill will also contain continued cuts to the corporate and financial institutions taxes. And he says the corporate tax cut could be the most significant:

"When you lay state corporate tax on top of the federal corporate tax, it's a real deterrent to come to the United States in the first place and Indiana has done very well attracting international business," Long said. "I think cutting our corporate tax rate to the second lowest in the country will pay dividends for us."

Long stresses that the deal is not finalized and has to be approved by caucuses in both houses.

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