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Potential Personal Property Tax Cut to Affect Manufacturers

Posted 4:57 PM by

Indiana Governor Mike Pence

During his 2014 State of the State address, Governor Mike Pence emphasized his intentions of reforming the corporate tax structure throughout Indiana, specifically within the realms of corporate tax and business personal property tax. In conjunction with Pence’s focus on resolving these issues, the Senate Tax and Fiscal Policy Committee recently passed Senate Bill 1 by a vote of 7-2. The bill lowers the corporate income tax rate from 6.5% to 4.9% and eliminates the personal property tax for smaller businesses. Pence’s support for the bill comes in the hopes that the General Assembly will pass the bill, or something similar, into law.

Senate Bill 1 states that businesses with less than $25,000 in personal property would no longer be required to pay the corresponding tax. While this would save small employers a collective $25 million a year, many larger manufacturers would be unable to take advantage of the law. (Patrick J. Kiely, president of the Indiana Manufacturer’s Association, is in favor of exempting all manufacturers from the personal property tax.) Additionally, many manufacturers are concerned with another proposal inside the bill which reduces the Research and Development tax credit by 50% to supplement revenue lost.

For more information regarding personal property taxes, please consult your KSM tax advisor.

Keywords: Manufacturing, Tax

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Katz, Sapper & Miller’s Manufacturing and Distribution Services Group provides traditional tax compliance and assurance services, but what sets us apart is the entrepreneurial spirit. Our strategic solutions will make your company more efficient, competitive, and profitable. Learn more.

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