[r69] Giving locals more tools to attract businesses

Posted by: Jay Wood  | Tuesday, February 18, 2014

STATEHOUSE - As a firm believer in limited government, I hold strongly to the notion that getting government off the backs of businesses is the surest way for the private sector to flourish and create more jobs. In recent years, the General Assembly has improved Indiana’s business climate by lowering the corporate income tax. While that has made Indiana increasingly competitive for new business investment opportunities, there is still room for growth and improvement.

This session, I am supporting House Bill (HB) 1001, a measure which would give local governments the option to exempt the business personal property tax (BPPT) on new investments. Business personal property refers to items used by a business that help generate revenue. For instance, a department store’s business personal property would include things like cash registers, shelves, scanners, etc.

There has been some misinformation about this initiative, so I want to address exactly what HB 1001 does and does not do. HB 1001 allows each county, via their County Option Income Tax Council, to determine if it is in the county’s best interest to exempt the BPPT on new investments.

HB 1001 is not a mandate. Counties are not required to exempt the BPPT; they can decide for themselves. This is vital because each county has a unique tax structure that relies on BPPT to varying degrees. So, what might be good for one county and its taxing options might not be ideal for another.

This legislation also has no bearing on current personal property, nor will it take away any of the tools currently available to locals to levy taxes. Counties can also rescind the tax exemption at a later date if they so choose. This is about giving counties more options in how they want to attract employers to their communities.

I read recently that the Seymour City Council passed a resolution voicing their opposition to HB 1001. I understand their concern about the community potentially losing out on a significant source of tax revenue. However, the beauty of HB 1001 is that Jackson County could determine locally whether they are in a position to eliminate the tax or not. If not, that’s their prerogative, at least we provided them the option, so they could attract more employers.

As a state legislator, I have to look out not only for my own community, but for the entire state. Even if Jackson County were to decide not to eliminate the BPPT, I cannot in good conscience deny other interested counties across the state the opportunity to eliminate the tax.

It is worth noting that of Indiana’s four neighboring states, Illinois and Ohio do not collect BPPT. Michigan will have it completely phased out by 2024. Kentucky still collects the tax, but they do so at a lower rate than Indiana. In order to maintain our competitive edge in the Midwest, we must make every effort to make Indiana an affordable and attractive place to do business. Attracting new businesses to the state will help create jobs and keep Indiana’s economy robust and prosperous. To support that effort, I am whole-heartedly in favor of HB 1001.


Rep. Lucas (R-Seymour) represents portions of Bartholomew, Jackson, Jennings and Jefferson counties.