A joint committee of the Mass. State Legislature gave its approval last week to a bill that if enacted would remove the absolute exclusion from paying property taxes that Harvard and all other non-profit institutions in the state have enjoyed since 1830.

Under the legislation that was unanimously given a favorable recommendation by the legislature’s Joint Committee on Taxation, cities and towns could force non-profits that purchased large tracts of property—those making up at least 2.5 percent of a community’s tax base—to continuing paying property tax, if the property had been taxable prior to the purchase. The legislation would apply retroactively to new purchases made since the beginning of 2001.

The legislation came as a response to Harvard’s ongoing financial dispute with the city of Watertown over the effect on city revenues of the University’s $162 million purchase in May of the Arsenal complex.

The complex represents one-third of the entire commercial tax base of Watertown. According to Larry Rasky, the head of a Boston public relations firm representing the city of Watertown, a non-profit firm purchasing such a great percentage of a town’s tax base in one transaction is without precedence nationwide.

As the law presently stands, Harvard would be exempted from paying taxes on any portion of the property used as part of the educational mission of the University.

Now that it has cleared the taxation committee, the legislation is in the hands of the House’s Committee on Steering, Policy and Scheduling. According to State Representative Rachel Kaprielian, a Democrat who represents Watertown and originally introduced the bill, under the rules of the House this committee must act on the legislation by the end of the month.

If the committee gives its approval to the bill, it would move to the House floor.