Whether the economy is booming or slipping toward recession, many Minnesota residents understand the importance of saving money where they can. While some of their costs are variable and can change or be eliminated from month to month, others are constant and become monthly or yearly obligations to pay. One obligation that individual citizens and businesses that own property are used to is property taxes. Property taxes are levied by the state as a form of revenue and are imposed on those who hold title to real property.
Recently the Minnesota legislature began looking at a new property tax bill that was introduced by state Republicans. The bill offers an overall reduction in taxes of around $2 billion over a period of years although Minnesota Democrats do not believe it is a good deal. Although early periods of the plan permit individuals to reduce their tax burdens, according to Democrats the majority of the property tax breaks ultimately fall on commercial property owners.
Democrats contend that big businesses such as the Mall of America would get many of the property tax breaks and that many big business property owners in the area do not even live in the state. Therefore, the planned property tax breaks that the Republicans have introduced would not even benefit property owners living in the state. Supporters of the bill disagree and contend that individuals within the state would reap many of the tax eliminating benefits of the proposed plan.
Owning commercial properties can be exciting for individuals interested in growing businesses and working within the real estate market. However, property taxes can be a significant expense for those who desire to hold title to parcels of commercial real estate. As state legislators debate this proposed commercial property tax plan, those curious about its outcome will have to wait and see if tax changes will impact their real property holdings.
Source: startribune.com, “Big business big winners in Minnesota property tax fight,” J. Patrick Coolican, April 28, 2015