In our rush to find ways to improve our tax structure while maintaining tax revenue, consideration should be given to elimination of the personal property tax, shifting that tax burden to real estate.

When I suggested this idea at a gathering recently, the first question I received, not surprisingly, was, “What is personal property tax?” The reason the question is not surprising is that most taxpayers are not assessed a personal property tax. Personal property taxes are assessed only on a business’ moveable assets and on mobile homes. In Spokane County, this tax comprises only about 4 percent of all property tax collections.

Shifting this tax to real estate would have a negligible effect for most taxpayers and would, in my opinion, greatly improve our state’s tax structure. Here’s why.

Our current tax structure is regressive, particularly to new business and business expansion. I cite the state’s business and occupation tax as an example. Nearly everyone agrees the B&O tax should be eliminated, but with the state facing huge budget deficits, this won’t happen. However, eliminating personal property tax on business assets would have a very stimulating effect on all business and, by shifting the burden to real estate, would be revenue-neutral.

Collection of personal property tax is inefficient. Both the assessor and treasurer spend an inordinate amount of county resources on personal property compared with real estate taxes. Five employee positions in Spokane County could be eliminated, without adding significant additional workload in real estate tax collections. Also, costs for printing and mailing and computer processing would be eliminated. The state Department of Revenue would also see significant savings in staff and expense.

While virtually 100 percent of real estate taxes are collected, the county writes off thousands of dollars of personal property taxes each year. Personal property taxes are written off when the property has disappeared or has deteriorated in value to a point that it is not salable. For example, this month the treasurer held a sale of 25 mobile homes where taxes were three years delinquent. Only three of the 25 had bidders. Many of the remaining ones literally had a negative value.

The tax on mobile homes in most instances taxes those in our society who can least afford to pay. (The expensive new double- and triple-wide “mobile homes” are usually taxed with the real estate already.) Eliminating the personal property tax on mobile homes will allow many low-income families to continue to be housed economically. Continuing the tax inevitably leads to the higher government cost of providing alternative subsidized housing.

For the good of the taxpayers and state and county governments, the Legislature and governor should consider this idea in the upcoming legislative session.