The Personal Property Tax Simplification Amendment Act of 2025 aims to increase the personal property tax exemption for businesses in the District of Columbia from $225,000 to $325,000. Additionally, the bill proposes to eliminate the requirement for businesses with property valued below this threshold to file the personal property tax return form (FP-31). This change is intended to reduce administrative burdens, particularly for smaller businesses that often have little to no taxable property. The current exemption level was established in 2008, and if adjusted for inflation, it would be approximately $324,000 today.

The legislation also outlines the tax rate structure, maintaining a rate of $3.40 per $100 of taxable value for property exceeding the new exemption threshold. For tax years beginning on July 1, 2026, the tax will be based on the new threshold of $325,000, with future adjustments tied to the local Consumer Price Index. This amendment aligns with national trends where many states are reducing or eliminating personal property taxes, thereby promoting a more favorable business environment in the District of Columbia.