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Tax fairness

Greenfield’s Town Council is expected to vote later this month on a split tax rate, a plan that separates what residents and businesses have to pay.

The idea is neither a new idea for Greenfield, nor would the town be one of the first to use this when it comes to having a different rates for homeowners and businesses.

And as was the case in previous attempts to get Greenfield to buy into a split tax rate, residents are going to hear plenty of arguments about fairness.

Fairness, however, applies to both residents and businesses.

Under the existing rates, businesses do not get the same services as residents. Companies, after all, are not sending students to Greenfield schools. They also have to contract for their own garbage disposal, although, of course, residents are being asked to pay for that service as well.

One might argue that in the name of being fair, services should be equal.

It’s also not particularly fair to claim that comparisons between, say, a house valued at “X” and a business valued at “X” are the same. Each value is based upon a wide variety of factors. Thus a homeowner may see their property increase in value and therefore also see a rise in what they pay in property taxes, while that business may actually see its worth decline, thus lowering the amount it provides the town.

Therefore, it is extremely important to be careful in making comparisons since you may dealing with apples and oranges rather than MacIntoshes and Cortlands.

So, does all of that mean a split tax rate makes sense right now for Greenfield?

We continue to argue that it doesn’t, based on the existing business foundation in town.

While there has been some growth in recent years, no one would characterize it as booming. Instead, we would argue that what a Boston Globe article found back in 2009 in looking at the split tax rate issue holds true three years later, “... for small businesses struggling in a sour economy, it can feel like a double whammy.”

And while it might hurt those businesses whose margins are not that healthy, studies have also found that a split tax rate is a disincentive for business growth, especially in attracting new companies to the community.

At this juncture, a split tax rate sends the wrong kind of message, both in and out of Greenfield.

The council should reject this proposal.

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