AB 1048

Under current law, beginning with the property tax assessments as of January

1, 2018, machinery, tools, and patterns, not including those items used in

manufacturing, are exempt from the personal property tax. However, beginning in

2019, the state pays each taxing jurisdiction an amount equal to the property taxes

levied on those items of personal property for the property tax assessments as of

January 1, 2017.

Under the bill, beginning with the property tax assessments as of January 1,

2022, no items of personal property will be subject to the property tax. Beginning in

2023, and in each year thereafter, the state will pay each taxing jurisdiction an

additional amount equal to the property taxes levied on the items made exempt

under the bill for the property tax assessments as of January 1, 2021.

The bill also makes a number of technical changes related to the repeal of the

personal property tax, such as providing a process whereby manufacturing

establishments located in this state that do not own real property in this state may

continue to claim the manufacturing income tax credit.

Because this bill relates to an exemption from state or local taxes, it may be

referred to the Joint Survey Committee on Tax Exemptions for a report to be printed

as an appendix to the bill.