Trouble is a-brewing for The Daniels Plan already. John Ketzenberger has an article entitled Daniels’ plan taxes loyalty of business. Pat Kiely of the Indiana Manufacturers Association and Kevin Brinegar of the Indiana Chamber of Commerce told Governor Daniels that his plan “wouldn’t fly” before he released it.
In particular, they object to the differential in property tax caps for homeowners versus business. Under The Daniels Plan, taxes on owner occupied residences would be capped at 1%, non-owner occupied residences at 2%, and business property at 3%. It stands to reason that the business community would object to a shifting of taxes back onto them. In significant part, it was a shift away from taxing business that caused the residential property tax spike in the first place. Elimination of the inventory tax shifted taxes from business owners to residential homeowners. The old, artificial assessment rules had a tendency to undervalue residential property, thereby reducing their prices. The more recent market-based values, therefore, resulted in a shift from business to residential.
I’m not trying to say that the old way was fair. I don’t know enough about it to pass that judgment. But, the fact remains that there was a shift in taxes off of businesses and onto residential homeowners. It makes absolute sense that the Indiana Manufacturers Association and the Indiana Chamber of Commerce would want to resist a shift back.
A bill that annoys the schools and annoys the manufacturers can’t be too bad.
Kiely and Brinegar are full of it.
There is no “shift back.”
While Daniels’ plan is not perfect, it is not going to shift property taxes back onto businesses.
As described, it simply isn’t.
The only thing that the Governor’s plan does is to take caps on business property that are already law (and will go into effect in 2010) and write them into the state constitution. In the case of residential rental property, the cap will apparently actually decrease from 3% to 2%.
What the business lobby is trying to do is not prevent the shift of property taxes onto them, but to undo what was a critical element of the program that the legislature passed to do away with the inventory tax (IIRC; I think the pending 2010 circuit breaker caps were passed as a part of the 2005 legislative session when the inventory tax was ended).
Daniels tax plan spoke of having appointed Assessors in Indiana. By the people not getting to elect the Assessors that give Daniels all the control. Indiana would be government run. That gives too much control to the sate government. The people still have a right to vote their officals into office.
I’m not sure much practical effect electing assessors has. My suspicion is that most people don’t really know who their assessor is (township or county) or what they do. At the end of the day, what they do is make a judgment as to what a particular piece of property is worth. They don’t decide how much that worth is taxed, except indirectly.
Ideally, you want someone in that position who is trained at assessing properties. I wonder if it would make any sense to keep them as elected officials, but make some kind of appraising credential a prerequisite to holding office.
The governor does not appoint the assessors under his plan.
They would be appointed by the County Council in each individual county. Given that probably many (if not most) counties have the same party in the majority on their councils that controls the assessor’s office, I wonder how many elected assessors will simply get appointed by the councils.
The upside of that is that there is a training requirement, and that the township assessors are still apparently all eliminated under the plan.