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COUNCIL OF THE DISTRICT OF COLUMBIA
The John A. Wilson Building
1350 Pennsylvania Avenue, NW
Washington, D.C. 20004
Statement of Introduction
Personal Property Tax Simplification Amendment Act of 2025
April 21, 2025
Today, I am re-introducing the Personal Property Tax Simplification Amendment Act of 2025
along with Chairman Mendelson, Councilmembers Janeese Lewis George, Matthew Frumin,
Charles Allen, Anita Bonds, Brianne K. Nadeau, Brooke Pinto, and Robert C. White, Jr. This
legislation would raise the current personal property tax exemption for businesses in the District
from $225,000 to $325,000 and remove the requirement for filers under the threshold to file the
personal property (FP-31) tax return form. This measure was originally introduced during
Council Period 25.
The District of Columbia levies a personal property tax on all tangible business property,
excluding inventories. The rate is $3.40 per $100 of taxable value, with the first $225,000
exempt. Taxable property includes machinery, equipment, and furniture, but excludes software
unless integrated into hardware. Nonprofits and specific businesses (such as solar systems and
qualified supermarkets) are exempt. Currently, all businesses, regardless of tax owed or
exemptions, must file an FP-31 form, detailing each asset's value and depreciation. This
requirement creates significant administrative burdens, particularly for smaller businesses with
little to no taxable property. According to data provided by the Tax Revision Commission, about
60,000 personal property tax returns were filed from July 2022 to June 2023, but fewer than
1,500 filers had a tax liability. Additionally, the current $225,000 exemption was established in
2008. If adjusted for inflation, the exemption value would be $324,000 today.
Currently, twelve states do not tax businesses’ personal property at all: Delaware, Hawaii,
Illinois, Iowa, Minnesota, New Hampshire, New Jersey, New York, North Dakota, Ohio,
Pennsylvania, and South Dakota. In addition, many other states are pursuing strategies to reduce
or eliminate tangible personal property taxes. Nationwide, nearly 100 bills have been introduced
in
23 states to reduce personal property taxes. Aligning with these efforts ensures that D.C.
remains an attractive place for small businesses, reducing administrative burdens and promoting
economic vitality.
I look forward to continuing to work with my Council colleagues to advance these critical
reforms, ensuring that the District remains competitive for small businesses while alleviating
unnecessary administrative burdens.
Christina Henderson Committee Member
Councilmember, At-Large Human Services
Chairperson, Committee on Health Facilities
Transportation and the Environment
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______________________________ ______________________________ 1 Chairman Phil Mendelson Councilmember Christina Henderson 2 3 4 ______________________________ ______________________________ 5 Councilmember Janeese Lewis George Councilmember Matthew Frumin 6 7 8 ______________________________ ______________________________ 9 Councilmember Anita Bonds Councilmember Charles Allen 10 11 12 ______________________________ ______________________________ 13 Councilmember Brianne K. Nadeau Councilmember Brooke Pinto 14 15 16 ______________________________ 17 Councilmember Robert C. White, Jr. 18 19 20 21 A BILL 22 23 ________ 24 25 26 IN THE COUNCIL OF THE DISTRICT OF COLUMBIA 27 28 ________________ 29 30 31 To amend Chapter 15 of Title 47 of the District of Columbia Official Code to increase the dollar 32 threshold for levying the personal property tax, and to exempt filers from including the 33 value of their tangible personal property on their tax returns if the value is below the 34 dollar threshold for taxation. 35 36 BE IT ENACTED BY THE COUNCIL OF THE DISTRICT OF COLUMBIA, That this 37 act may be cited as the “Personal Property Tax Simplification Amendment Act of 2025”. 38 Sec. 2. Chapter 15 of Title 47 of the District of Columbia Official Code is amended as 39 follows: 40 (a) D.C. Official Code § 47-1522(a) is amended to read as follows: 41
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“(a) Each year the District shall levy a tax against every person on the tangible personal 42 property owned or held in trust in that person’s trade or business in the District. The rate of tax 43 shall be as follows: 44 “(1) For tax years ending before June 30, 2025, the rate of tax shall be $3.40 for 45 each $100 of value of the taxable personal property, in excess of $225,000 in value; 46 “(2) For the tax year beginning on July 1, 2026, the rate of tax shall be $3.40 for 47 each $100 of value of the taxable personal property, in excess of $325,000 in value; and 48 “(3) For each tax year thereafter, the rate of tax shall be $3.40 for each $100 of 49 value of the taxable personal property, in excess of $325,000 multiplied by the percentage that the 50 local Consumer Price Index as defined in § 47-1807.14(2), has risen during the calendar year in 51 which the tax year began, rounded to the nearest whole dollar.”. 52 (b) D.C. Official Code § 47-1523(a) is amended to read as follows: 53 “(a) The full and true value and the current value of tangible personal property, including 54 taxable leasehold improvements, having a taxable situs in the District shall be reported on the 55 return if, for the tax year, the value exceeds the threshold for taxation under § 47-1522. The full 56 and true value shall be the original costs of the tangible personal property in an arms-length 57 transaction, computed as of July 1st of the tax year. The current value of the tangible personal 58 property shall be the full and true value less a reasonable allowance for straight line depreciation 59 in accordance with rules promulgated by the Mayor and the provisions under subsections (b), (c), 60 (d), and (e) of this section. Tangible personal property items with a useful life of one year or less 61 shall be reported at cost. No proration of value shall be permitted in anticipation of the 62 disposition of an item of tangible personal property. In no event shall the current value reported 63
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be less than 25% of the original cost or exchange value of the tangible personal property, except 64 as permitted under subsection (b) of this section.”. 65 Sec. 3. Fiscal impact statement. 66 The Council adopts the fiscal impact statement in the committee report as the fiscal 67 impact statement required by section 4a of the General Legislative Procedures Act of 1975, 68 approved October 16, 2006 (120 Stat. 2038; D.C. Official Code § 1-301.47a). 69 Sec. 4. Effective date. 70 This act shall take effect following approval by the Mayor (or in the event of veto by the 71 Mayor, action by the Council to override the veto), and a 30-day period of congressional review 72 as provided in section 602(c)(1) of the District of Columbia Home Rule Act, approved December 73 24, 1973 (87 Stat. 813; D.C. Official Code § 1-206.02(c)(1)). 74