(Aug. 6) – Property taxes got a little less burdensome for tens of thousands of Colorado small businesses today, when a new law sponsored by Reps. Dianne Primavera (D-Broomfield) and Dave Young (D-Greeley) went into effect.
The new law gives small businesses a break on their business personal property tax. Just as families pay sales taxes when they buy a car or a refrigerator or the furniture for their homes, businesses pay sales taxes on their office desks and chairs and the machines they use to provide products or services.
The sales taxes paid by the homeowner are one-time-only, point-of-sale expenses, but the business personal property tax is assessed on the same office furniture and machinery every year.
HB14-1279 gives a tax credit to businesses with $15,000 or less of personal property, and this threshold will be adjusted annually for inflation.
“For small businesses with limited resources, the BPPT can hamper their ability to expand or purchase new equipment,” Rep. Primavera said. “Our economic recovery allows us to ease taxes on Colorado’s small businesses, and we’re doing it in a way that won’t harm our schools and local governments.”
Unlike previous legislative attempts at business personal property tax reduction, this new law will not cut into the revenues of local governments and school districts. These jurisdictions will still determine their own tax policies on this type of property, and will continue to receive business personal property taxes from these businesses.
“We have created an important tool to help more than 30,000 small businesses in Colorado,” Rep. Young said. “While we know our economy is improving, many small businesses are still struggling. This bill may give them the boost they need.”
HB14-1279 passed through the legislature with broad bipartisan support, and was endorsed by the Colorado Association of Commerce & Industry, the Denver Metro Chamber of Commerce, the South Metro Denver Chamber of Commerce, the Northern Colorado Legislative Alliance, the National Federation of Independent Business, the Colorado Municipal League, Colorado Counties Inc. and the Economic Development Council of Colorado.
HB14-1279 was one of dozens of laws passed during the 2014 legislative session that went into effect today, the 90th day after the end of the session.