Small-business owners seek relief from large tax burden

By Sarah Favot, Town Correspondent

The Board of Selectmen and Board of Assessors held a joint public meeting Tuesday to discuss how the town sets the tax rate and ways that the town can ease the tax burden on small businesses.

Some small-business owners expressed concern that they carry a large portion of the town’s property tax burden.

Because commercial property taxes are valued using shift percentages, businesses that are valued over $1 million are taxed 175 percent more than residential properties, which is governed by legislation.

In fiscal 2011, 80 percent of the town’s valued property was residential, while residential property taxes accounted for only 65 percent of the town’s total taxes. Because of the shift percentages, commercial property made up 35 percent of the town’s total property taxes, although commercial property only accounts for 20 percent of the town’s land.

Town Administrator William Keegan said that aside from fees, money from motor vehicle excise tax, and state aid, property taxes are the biggest revenue generators for the town.

Selectwoman Sarah MacDonald said the town has found another revenue generator in the hotel and meals tax, which has been earmarked for future capital building projects.

Russell Stamm, a small-business owner and Finance Committee member, suggested that the town look into splitting up the category of what qualifies as a commercial property to separate small businesses from big box stores.

“Is there a way to get a split rate amongst commercial taxpayers?” said Stamm. “Make a difference in what we define as commercial, like small businesses that have 25 or fewer employees.”

Selectman Paul Reynolds, who is also a small-business owner, said the tax burden on small-business owners who renovate their property is retroactive.

“If you improve your business, you’re going to get a higher tax bill,” said Reynolds. “There is a disincentive to improve your business, and that fights efforts for revitalization.”

Keegan suggested having a certain dollar amount of renovations being exempt from the valuation of the property for small businesses.

Both of these change would require legislation, said Keegan.

Reynolds said that he would lead a committee to look into what other towns have done to ease these burdens on small businesses.

Sarah Favot can be reached at sarah.yourtown@gmail.com.
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