Local News / February 6, 2014

What’s At Stake For Indiana Businesses In Lawmakers’ Equipment Tax Debate

Kyle Stokes - StateImpact Indiana
What’s At Stake For Indiana Businesses In Lawmakers’ Equipment Tax Debate

The Draper, Inc., plant in Spiceland might have been the birthplace of your school’s gymnasium.

The manufacturer actually makes all kinds of equipment for schools, from window shades to projection systems. Look one way and you’ll see a basketball hoop hanging from the ceiling. Look another direction, and you’ll see wall padding stacked on a pallet.

“I’ll sell a lot of these to Saudi Arabia,” says Nate LaMar, who manages international sales.

Any equipment Draper employees use to make these products in its 400,000 square foot plant in Spiceland — from staple guns to forklifts — is subject to Indiana’s business personal property tax. It’s not just manufacturing equipment; office supplies and computers are taxed too.

LaMar says he sees both sides of state lawmakers’ current debate over whether to cut that tax, which generates $1 billion in revenues for local governments. In addition to his work at Draper, LaMar is also president of the Henry County Council. If lawmakers totally eliminated the tax, the county’s budget takes a $391,000 hit.

Though neither of the bills General Assembly members approved last week amount to a total elimination of the business personal property tax, school districts still stand to lose more than $170 million from funds already bruised by the state’s property tax caps.

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