Indiana 2023 Regular Session

Indiana House Bill HB1618

Introduced

1/19/23

Refer

1/19/23

Caption

Exemption for new business personal property.

Impact

This legislation is expected to have a notable impact on economic development within the state as it could incentivize businesses to invest in new property without the concern of immediate taxation. By removing this financial hurdle, supporters argue that it will help cultivate a more favorable business environment, potentially leading to job creation and increased economic activity. The exemption could especially benefit small to medium-sized enterprises looking to expand their operations in Indiana.

Summary

House Bill 1618 introduces significant changes to the taxation of business personal property in Indiana. Effective January 1, 2024, the bill exempts the total acquisition cost of a taxpayer's business personal property, purchased after December 31, 2023, from property taxation in a county for assessment dates. This aims to encourage investments from businesses by alleviating the tax burden related to newly acquired personal property.

Contention

Despite the benefits outlined, there are points of contention surrounding this bill. Opponents may argue that by completely exempting these assets from taxation, local governments could lose crucial revenue streams that are used for funding public services. Concerns also arise about how this exemption may affect taxpayer equity, as existing businesses with older equipment would still pay property taxes, while new businesses could operate without that financial obligation, potentially creating an uneven playing field.

Additional_notes

The process for claiming the exemption requires specific declarations on the taxpayer's personal property tax return, which must include whether the property is located in one or multiple locations and identification of the address where the property is held. Penalties are also specified for failure to properly file the necessary documentation, further solidifying the framework around the implementation of this bill.