The Worcester City Council on Tuesday will debate City Councilor-at-Large Morris Bergman’s proposed small business real estate tax break.
If approved by the City Council, it would allow an exemption of up to 10% of the value of the parcel. It would be available to businesses employing no more than 10 people and are located on property with an assessed value of less than $1 million.
The Legislature enacted the measure nearly three decades ago to give cities and towns the option to provide tax relief for small businesses. About a dozen municipalities have given the commercial exemption the green light.
In his proposal, Bergman agues large businesses have access to a variety of tax breaks while small businesses do not. Like every city and town, he has said, small businesses in Worcester comprise the bulk of the city’s economic base.
But the Worcester Regional Chamber of Commerce said while Bergman’s proposal might make a good political sound bite, it would further raise the commercial/industrial tax rate on 96% of Worcester businesses, a group, the chamber said, which has already seen disproportionate increases because of the tax classification votes taken by the council over the past five years.
“Councilor Bergman’s order simply facilitates a counterproductive argument about how to cut up pieces of the shrinking pie that is Worcester’s commercial/industrial tax base,” the chamber said in a statement.
Since 1984, when the dual tax rate was adopted, Worcester’s commercial/industrial/personal property tax base has shrunk, the chamber said, while the council has increased the tax differential burden on Worcester businesses has been a contributing factor in the loss of more than 700 manufacturing jobs from Worcester, the Chamber argues.
There are about 9,295 for-profit businesses in Worcester, the chamber said, and 375 businesses would qualify for this exemption.
“The adoption of Councilor Bergman’s order would simply further raise the tax burden on approximately 8,920 businesses across the city, most of which are small businesses,” the Chamber said.
Bergman could not immediately be reached for comment.
