Wednesday, January 9, 2013

Governor urges personal property tax repeal

Tax brings $141 million to local governments annually


By KATHERINE WUTZ
Express Staff Writer

In his State of the State address Monday, Gov. Butch Otter urged the Legislature to repeal the personal property tax, which brings $141 million to taxing districts statewide annually.

Otter said that “nearly everyone agrees” that the personal property tax is an “unfair drag” on the economy, and that he supports any legislation repealing it—in fact, he said, it should be a “priority” for the 62nd legislative session.

The personal property tax is a tax on items that are used for business purposes, such as office computers and equipment, furniture and uniforms.

Otter said he realized that many cities and counties rely on this revenue to pay for public services, but added that he preferred to put the authority to raise revenue with the district that would be spending the money. 

Otter said his plan would be to give taxing districts the authority to enact local taxes, though in a later press conference he refused to specify if those taxes would be on income or sales.

Otter said during a press conference after the speech that he feels local taxes would lead to more accountability than the state-imposed personal property tax.

Otter did not set out parameters for how the authority to weigh local taxes would be issued by the state—such specifics, he said, would be up to the Legislature.

State Democrats issued a written press release Tuesday that states that the party understands the urge to repeal the tax, but worries about a repeal’s impact on local communities.

“The Legislature must not force communities to cut critical services,” the release states. “We must equip communities to meet the demands of local businesses.” 

Otter also said he would not introduce or urge any major education reforms this year. He offered a budget recommendation that would increase state spending by 3.1 percent, some of which would go toward funding programs such as dual enrollment in college and high school classes that had started before the Luna education reforms were overturned in November. 

Otter said the boost in spending reflects the “slow and steady growth” of the state’s economy.


Kate Wutz: kwutz@mtexpress.com

 




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