Wisconsin lawmakers have been trying to find a way to eliminate business personal property taxes for years. The problem is how to make up lost tax revenue.
Bills have been filed in the current legislative session to make the repeal of the tax part of the state budget.
Companion bills are currently under consideration. Senate Bill 218 and Assembly Bill 277 seek to exempt all personal property beginning with January 1, 2018 property tax assessments. Under the bills, improvements on leased land would be assessed as real property. The proposals create a state aid payment for revenue losses resulting from the exemption.
Governor Scott Walker said he's open to repealing personal property taxes but only under certain conditions. "I want to make sure that the property tax relief that we're providing for homeowners across the state is maintained, I don't want it to be one at the expense of the other," Walker said. "So, if there are ways they can chip away at that without taking away from the property tax relief we proposed in the budget, then we're willing to look at it."
Lawmakers heard from small business owners, who testified that the tax has made it difficult for them to do business.
"By investing in our business, we ended up with a higher tax bill," an owner in the Milwaukee area complained. "In fact, at a time when we could use help the most, when we have just spent a lot of money remodeling a store, the tax is the highest."
Opponents to the bills argue that supporters haven't offered a good way to replace the estimated $261 million annually that would be lost if the tax were repealed.
"I think that the personal property tax is not a good and fair tax, but just to repeal it without a plan to backfill the dollars that municipalities and schools and counties rely on is not a good idea," said Senator Janis Ringhand.
The bills repealing the personal property tax have yet to receive a vote in committee.