SB 336 – Assessments and Tax Exemptions
Authored by Sen. Aaron Freeman (R-Indianapolis)
Provides that the business personal property exemption from taxation is based on the assessed value of the business personal property instead of the acquisition cost.
Chamber position: Support in Part (No position on the taxability of reward money)
The latest: The bill was heard in the House Ways and Means Committee and held for possible amendment. Last year this bill passed the Senate but did not receive a hearing in the House.
Indiana Chamber action/commentary: The primary objective of the bill is to base the $40,000 “de minimus” exemption threshold on the depreciated value of the property instead of the purchase or acquisition cost. The Chamber testified in support, citing the need to recognize depreciation in order to make the threshold reflect a true value-based threshold. We argued that a small business owner who bought equipment years ago at a cost that exceeds the $40,000 qualifying threshold by a small margin and is not worth anywhere near that amount anymore “shouldn’t be stuck paying tax on it forever.” Our testimony concluded with the suggestion that this bill is a “small fix with a small price tag, and it helps the very people they (the legislators) are trying to help right now: small businesses.”
Some discussion focused on the administrative process involved in having to establish the assessed value rather than the purchase price in order to determine qualification for the exemption. Opponents focused on the possibility of appeals and the loss of revenue.
We are in communication with the Ways and Means chair in effort to ensure the desirable outcome on the bill.
Resource: Bill Waltz at (317) 264-6887 or email: bwaltz@indianachamber.com
