HD24 - Classifications of Tangible Personal Property for Taxation
Executive Summary: House Joint Resolution 271 (see Appendix 1) requested that the Department of Taxation make a study of the various classifications of tangible personal property permitted under the law to determine the equity and economic impact of localities. Whenever there is a system whereby property is classified for taxation, there is always the possibility that a seemingly inequitable situation will arise between classifications particularly when different rates apply. The policy of the Commonwealth has been to permit various classifications but to require equity within the classes. In this regard, the tangible personal property taxes are equitably administered. The policy of allowing different rates between classifications is a matter which is beyond the scope of this study. The economic impact on localities adopting different rates between classifications is relatively small as evidenced by Appendix 2A. The statute (58.1-3506) would permit an even greater impact, but, except for mobile homes (required to use the real estate rate) and machinery and tools, most governing bodies have chosen not to vary the rate from the tangible personal property rate. |
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