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Elimination of Personal Property Tax January,2014

Elimination of Personal Property Tax January,2014. Elimination of Personal Property Tax. Recent LSA memo estimates $1.063 b illion of tax revenue would be eliminated… Legislative Services Agency Memorandum, 12/23/2013. Elimination of Personal Property Tax-Effect.

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Elimination of Personal Property Tax January,2014

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  1. Elimination of Personal Property TaxJanuary,2014

  2. Elimination of Personal Property Tax Recent LSA memo estimates $1.063 billion of tax revenue would be eliminated… Legislative Services Agency Memorandum, 12/23/2013

  3. Elimination of Personal Property Tax-Effect • Circuit breakers to local units (cities, towns, counties,school corporations, libraries etc.) would account for $554 million lost revenue Legislative Services Agency Memorandum, 12/23/2013

  4. Elimination of Personal Property Tax-Effect • Tax shift to real property owners would account for $350 million Legislative Services Agency Memorandum, 12/23/2013

  5. Eliminaton of Personal Property Tax 1. LOST REVENUE

  6. LOCAL LOSS OF REVENUE LOSS OF REVENUE ESTIMATED BY KOSCIUSKO COUNTY ASSESSOR AND AUDITOR FOR WARSAW CIVIL CITY IS: $2,214279.28 (11% of General Fund)

  7. REPLACEMENT? • No current replacement revenue proposed by governor

  8. REPLACEMENT? • No current replacement revenue proposed by state

  9. Elimination of Personal Property Tax SHIFT BURDEN to: LOCALWAGE EARNERS

  10. REPLACEMENT? • State Legislators considering shifting replacement to Local Option Income Tax- .77% increase in payroll tax for Kosciusko County (-LSA Memorandum 12/23/2013)

  11. Elimination of Personal Property Tax 2. SHIFT TAX BURDEN

  12. Eliminaton of Personal Property Tax 23% of Current Assessed Value attributable to personal property tax

  13. Eliminaton of Personal Property Tax Assessed Value will go down and tax rates will go up “

  14. Elimination of Personal Property Tax “With the levy limited and assessed value smaller, most tax rates would go up. Personal property owners would pay less, but higher tax rates would shift this tax burden to everyone else “ Larry DeBoer, “What Happens if We Eliminate Property Tax on Business Equipment” 11/27/2013

  15. Eliminaton of Personal Property Tax SHIFT BURDEN to: LOCALHOMEOWNERS

  16. Eliminaton of Personal Property Tax SHIFT BURDEN to: LOCALBUSINESS OWNERS

  17. LOCAL SHIFT Approximately $775,000 will be shifted directly to real estate property taxpayers, both residential and commercial

  18. Eliminaton of Personal Property Tax 3. LOSS OF LOCAL ECONOMIC DEVELOPMENT TOOLS

  19. Loss of E.D tools Currently, ABATEMENT give local Redevelopment Commission the flexibility to phase in or eliminate personal property tax on a case by case basis.

  20. Loss of E.D tools Currently, local Redevelopment Commissions have the flexibility to directly invest personal property tax increment into favorable investment for the developer (ie Winona PVD, Medtronic)

  21. Loss of E.D tools Elimination of Personal Property Tax eliminates an already limited Local Economic Development Tool Box of yet another incentive. Does this help meet the original goal of improving Indiana business climate by eliminating PPT?

  22. Loss of E.D tools One proposal gives counties the ability to opt out of PPT individually… pitting counties against each other, destroying the synergy of regionalism Does this help meet the original goal of improving Indiana business climate by eliminating PPT?

  23. Position • We are opposed to the elimination of personal property tax, in part or in its entirety, over time or immediately, without guaranteed, complete income replacement. “REPLACE NOT ERASE”

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