Earlier this year, Gov. Kay Ivey signed the Small Business Relief and Revitalization Act of 2022 (HB82) into law.
One of the components of that legislation provided an exemption of up to $40,000 of market value from the state business personal property tax. According to Ivey's office at the time of her signing, it exempted 75% of Alabama businesses from payment of the state portion of this tax.
If State Sen. David Sessions (R-Grand Bay) has his way, he would completely eliminate the tax.
Monday, during an interview on Mobile radio FM Talk 106.5's "The Jeff Poor Show," Sessions called the tax "regressive." Although he acknowledged the tax's importance to some counties as a significant revenue stream, he suggested such a tax could put some small businesses out of business and, therefore, offer no tax revenue or any other benefit at all.
"I'm certain they'll be more," Sessions said. "Like I said, we did several last year. We did a small one on the business personal property tax. As a small business person, I've never really liked that one that much. I would like to see it done away with totally. It's personal, and I understand when you do a huge cut like that, you may be hurting some counties that really depend on that revenue. At some point, it's not doing you a whole lot of good to somebody out of business, and they close up their doors and leave the county.
"So a business that has a $10 million piece of machinery in their shop or their warehouse or whatever they're doing, they have to pay a property tax on that every year. To me, that's really regressive. I would like for the legislature to look at continuing to cut that – cut it a little deeper. I think we did it at cutting it at $40,000, the first $40,000 of equipment was totally exempt. I would like to see that. And to be forthright on this issue, Jeff, I'm in agriculture. I'm exempt from business personal property tax as a farmer. But for some of these small businesses, it's hard. And they have a lot of high-dollar equipment they're paying that tax on every year."
To connect with the author of this story, or to comment, email jeff.poor@1819News.com.
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