Pharos-Tribune

State News

February 7, 2014

Pence reaffirms support for end to business tax

Indiana mayors demand replacement revenue.

INDIANAPOLIS — Despite intensifying opposition from mayors around the state, Gov. Mike Pence is re-affirming his pledge to eliminate a $1 billion tax revenue stream for local governments.

Pence said he wants to eliminate the business personal property tax to boost job creation in the state, but still has no detailed plan to replace the lost revenue or to prevent a shift in the tax burden to homeowners and other property owners.

During a press conference with Statehouse reporters Thursday, Pence said he’s “in negotiations” with legislative leaders on the issue. Both the House and the Senate have bills that begin to phase out the tax in different ways, but neither bill replaces the lost revenue.

Pence said the legislation need to be improved, but declined to elaborate.

“I know you all want me to talk about details,” Pence said, after he was repeatedly questioned about how he’ll prevent what he calls “undue harm” to local governments if the tax is repealed.

“I don’t want to negotiate this in public,” Pence said.

His comments came on the same day of the release of an independent report that says eliminating the business personal property tax would drain significant revenue from local governments and would increase taxes on homeowners, farmers, landlords and other property owners by $376 million.

In 24 of Indiana’s 92 counties — including White County — those property owners would see a 12 percent or more increase in their tax bills.

The report, issued by the non-partisan Indiana Fiscal Policy Institute, also found that eliminating the tax would have minimal effect on luring new jobs to the state, but could pit local communities against each other.

Pence told reporters that he hadn’t read the report but that he believed it would add to the ongoing debate over his tax elimination plan.

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