HB 1402 / Chamber Supports | SB 1 / Chamber Neutral
The House Ways and Means Committee reconvened last week to further examine Senate Bill 1, specifically focusing on a potential amendment incorporating provisions from House Bill 1402, authored by Ways and Means Chairman Rep. Jeff Thompson (R-Lizton). Representative Thompson presented the committee with an amendment intended to replace SB 1’s original language with that of HB 1402, significantly altering the approach to property tax reform. The chairman acknowledged that the bill required additional refinement but emphasized the necessity of addressing homeowners’ concerns regarding the lack of tangible tax relief.
House Bill 1402 proposes a phased, five-year plan transitioning Indiana from its current levy-based system to a rate-based model. Under the proposed structure, circuit breaker credit losses will be eliminated due to a combined property tax rate being capped at 3%. Thompson emphasized that this change is intended to resolve inherent conflicts between levy-based calculations and constitutional rate caps.
House Bill 1402 also includes an exemption of newly acquired business personal property (BPP) as well as a phased increase in the BPP de minimis exemption and phaseout of the 30% floor on BPP. A study conducted by the Indiana Chamber Foundation estimates these reforms will increase state GDP growth by more than $3 billion and create approximately 24,000 jobs.
Several committee members, including Reps. Hal Slager (R-Schererville) and Cherrish Pryor (D-Indianapolis), requested further clarification and more detailed fiscal analysis, underscoring the need for clear fiscal modeling to understand the potential consequences of the proposed amendments.
Representative Slager explicitly noted concerns about unclear financial implications, suggesting that the committee needed more precise data before proceeding.
With many points of contention still unresolved, the committee held the bill for further analysis, signaling ongoing debate over property tax policy. An additional hearing where members will amend and vote on the bill is anticipated in the coming weeks.
