A.__Beginning April 1, 2005, 20% of the just value of the business property is exempt;

B.__Beginning April 1, 2006, 40% of the just value of the business property is exempt;

C.__Beginning April 1, 2007, 60% of the just value of the business property is exempt;

D.__Beginning April 1, 2008, 80% of the just value of the business property is exempt; and

E.__Beginning April 1, 2009, 100% of the just value of the business property is exempt.

3.__Reimbursement to municipalities. The State shall reimburse municipalities for revenue lost as a result of the operation of this section according to the procedure established in section 661.

Sec. 3. 36 MRSA §6664 is enacted to read:

§6664.__Repeal

This chapter is repealed April 1, 2010.

SUMMARY

This bill provides an exemption of 20% from personal property taxation on business property beginning April 1, 2005 and increases that exemption by the same amount each year until the business property is completely exempt beginning April 1, 2009. Under the requirements of the Constitution of Maine, Article IV, Part Third, Section 23, the State is required to reimburse each municipality 50% of the property tax revenue loss suffered by that municipality as a result of this bill.

This bill also repeals the business equipment tax reimbursement program in 2010, since business property is exempt from personal property taxation beginning April 1, 2009 and businesses currently have one year to file for reimbursement.