It’s a personal property tax exemption for me, but not thee

Craig Hall, Publisher
Craig Hall, Publisher

Here we go again. Take a bad regulation from something under the government’s bucket of you-know-what and try to make it smell like a rose. And no, this isn’t an attack on a county commissioner, even though the one of the same name was recently touting the topic at hand. Then again, at least there was something to tout, even if the rules are so strictly set that few, if any across the state could take advantage of the situation.

But this is what you get when government makes the rules on things that should be free. You get bad laws that have more bad law after bad law heaped upon them under the guise of “fixing” them. You get laws that benefit one group more than all the other groups — and those groups are always those on the inside, lobbyists and cronies, the select few with the bucks and backing to get something on the ballot, the group that makes the most noise or the group the will bring the most votes.

But what those groups can never, ever be are the millions of citizens or thousands and thousands businesses of the state of Colorado. And this personal property tax exemption that is being parroted as some boon for business is a case and point. Because in Mesa County this “boon” benefited exactly four businesses.

Now I’m not going to rip on the businesses that qualified and took advantage of this tax exemption. There were the rules and parameters the businesses needed to meet and they met them. So in that sense — and in that same sense for any tax a business can avoid — the businesses should absolutely take advantage of the situation. My problem isn’t with them taking advantage of the law. My problem is in why can’t EVERY business in the state take advantage?

And that goes back to one of my original points. Regulations are written for the benefit of  a select few at a cost to all the rest. As that fact relates to the personal property tax exemption, the rules state:

1. That a business has to create at least one job. Now at this point every business could and should be yelling, “Hooray, create a job and get a tax break for my business!” And they all could if it weren’t for what’s next.

2. Your business must make a million dollar investment to qualify.

Let’s forget the fact this personal property tax exemption is a tacit admission the lower the tax on businesses, the better things are for economic expansion. Because to have that conversation would force politicians to actually talk about the fact taxes are bad and need to be reduced to as small an amount as possible so government can operate and perform its constitutional functions. I mean, if government and politicians did that, how would they punish enemies and exert control over the masses?

Instead, let’s concentrate on the facts about personal property tax laws in our state. First off, the business “personal” property tax is a tax business owners pay on equipment they’ve already purchased and paid taxes on. It’s sort of the state’s own version of a capital gains or death tax. I mean, if you can figure out a way to tax something twice, why not do it? But politicians are nothing if not tax and vote buying savvy, so they came up with what they always come up with on taxes — an exemption. Government needs tax exemptions not to save people money on taxes, but rather to threaten to take something away come election time. For instance, there’d be no merit to the threat of taking away your mortgage exemption if federal tax rates weren’t so onerous to begin with.

So beyond the fact we all know we are overtaxed is the $1 million investment requirement on this law. I hate to break it to our lawmakers, but the vast majority of businesses in our state don’t do
$1 million dollars in revenue in a year, let alone have it to invest. In other words, this law doesn’t really help anyone, especially in Mesa County, except for perhaps the lucky few who have the right year in which they qualify. I wonder how many businesses over by Denver qualify? The answer would be many, many more. All who have more access to the folks writing the laws to their constituents’ benefit.

So the small businesses throughout the state will continue to have to deal with personal property taxes on their businesses. On a side note, how does one tax personal property at a business? Oh, that’s right. This is something the government came up with because they couldn’t let sole proprietorships get away with claiming business income on their personal taxes. It’s like having to claim your old office chair, laptop and desk as “assets.” As if they’d bring in more than two cents on the dollar if sold.

And yes, I know some folks will say they’ve tried to repeal the business personal property tax over the years to no avail. Then again, governments aren’t big on repealing taxes, so that’s a moot point as some type of effort.

My question is why is there a business personal property tax in the first place? The answer is simple: Because the State of Colorado can have one.