Inaccurate statement

An article published on Dec. 26 (“Business tax targeted for repeal”) begins with an inaccurate statement made by this newspaper as a matter of fact.

The article was about attempts by Gov. Baldacci and the business lobby to create a new property tax exemption for a large class of business-owned property, roughly 10 percent of the entire municipal tax base. Municipal officials are concerned about this proposal because it will lead to an increased property tax burden for the remaining property taxpayers who won’t get the exemption. In this case, the increased property tax burden will hit Maine’s residents, second homeowners, landlords, owners of open land, and small businesses.

The first sentence of the article stated that: “Most states do not tax personal property used in business.”

Actually, most states do tax personal property used in business. Thirty-eight states and the District of Columbia include in their overall property tax base the “personal property” of businesses. In fact, many of these states apply a rate of taxation to business personal property is greater than the property tax rate applied to residential real estate.

It is also true that many of those other states employ a variety of business incentive programs that can dedicate a business’ personal property taxes to certain purposes or relax the tax obligation for fixed periods of time or in certain locations, just as Maine has the Business Equipment Tax Reimbursement program (BETR) and “Tax Increment Financing” programs on the local level.

The reporter could have easily discovered this information with a simple phone call to a variety of sources. Just as one example, the Maine Municipal Association has been providing comprehensive state-by-state comparisons on this subject for many years to legislators, the business community and the Maine press.

Geoff Herman

Maine Municipal

Association

Augusta