Walmart trims its local taxes.
A tax break for Walmart means higher taxes for residents, according to assessors in several area communities.
Wal-Mart Associates Inc. is headquartered in Bentonville, Ark., but stores incorporated in Massachusetts become domestic corporations - eligible for tax breaks - and it appears that many of the state's Walmarts have recently taken advantage of those breaks.
Bob Bliss, spokesman for the state Department of Revenue, said, "One effect is that they are exempt from most personal property taxes. On the flip side, this may result in more state excise taxes paid. This is an individual decision each entity can make."
In Central Massachusetts, there are Walmart stores in Oxford, Orange, Worcester, Leicester, West Boylston, Northboro, Sturbridge, Leominster, Hudson, Gardner, Bellingham, Lunenburg, Ware, Whitinsville and Framingham.
John F. Prescott, principal assessor in Leicester, said that last year, the Walmart Superstore there paid taxes on a personal property assessment of $8 million. Most of those taxes were lost when the Walmart incorporated in Massachusetts this year.
"We lost about $100,000 in personal property taxes. The levy is not reduced, so the rest of the town has to pick up the difference. It added a little bit to the tax rate. We lost a lot of value. It's unfortunate," he said.
Laura Jablonski, senior administrative clerk for the assessors in Ware, said the Walmart there also incorporated. "We lost $102,000 in tax revenue. All cities and towns could use the money."
William Ford, city assessor in Worcester, said the Walmart and Sam's Club there were already incorporated and did not pay personal property taxes on inventory.
"It would have been nice," he said.
In Oxford, Christopher T. Pupka, town assessor, said the loss of personal property tax from Walmart this fiscal year "will push the tax rate up," but only a little, to make up the difference.
"The law is written to help corporations in Massachusetts. Walmart is still paying taxes on the building and on some personal property, such as machinery, but not on inventory."
He said Walmart paid $75,548 in personal property taxes and $112,107 in real estate taxes in fiscal 2011. He expects to lose most of the personal property tax this year, and said, "We are lucky we have a large commercial tax base to help absorb the loss."
Selectmen in Oxford voted unanimously on Tuesday to ask state legislators to consider eliminating this tax loophole for personal property.
Selectman John G. Saad said, "I'd like to see if something can be done to protect communities. The town has been accommodating to Walmart, and Walmart does pay taxes, but if they want to be part of this community, don't take away from this community.
"Every taxpayer will feel that added burden, however small. Taxes will go up for every other taxpayer, while they will go down for Walmart. The town loses. Maybe we could change the tax code so communities don't get hurt by corporate decisions."
Mr. Bliss said, "A change would require a re-write of the corporate tax code as it relates to exemptions for personal property. In a community where a Walmart store incorporates in Massachusetts, this will mean less personal property tax, but the personal property tax is the tail of the dog."
Bob Ellia, executive director of the Massachusetts Association of Assessing Officers, said the practice of incorporation for tax savings is common.
"I don't know if this is a trend, but I do know it is not at all uncommon. Major companies do an analysis and compare what they pay in taxes under what status and do what they can to save money."
Wal-Mart Inc. could not be reached for comment and did not return telephone calls and emails.
Wal-Mart Inc., which owns Sam's Club and Walmart stores, has 9,000 retail outlets in 28 countries and employs 2.1 million associates, including 1.4 million in the United States, according to the company website. The company reported $419 billion in sales last year, to earn first place in the 2011 Fortune 500 list of the world's largest companies by revenue.
ART: PHOTO; MAP
CUTLINE: (PHOTO) Oxford Selectman John G. Saad: "I'd like to see if something can be done to protect communities." (MAP) Walmart: Central Mass. Walmart locations
PHOTOG: (PHOTO) T&G Staff/JIM COLLINS (MAP) T&G Staff/DON LANDGREN JR.