Community update on the proposal to modernize the state tax system | Characteristic
Jim Smith, the former Papillion State Senator and Platte Institute’s director of strategy, was in Norfolk Thursday morning for coffee downtown.
Smith, who is also president of the Blueprint Nebraska economic initiative, was in town for lunch Thursday to discuss tax modernization with a group of area chamber of commerce members and community leaders. He said while in the city center he noticed a mix of people including many young people.
âIt’s a city that has a lot going on,â Smith said. âIt really paves the way for our state in terms of growth, dynamism and unity. “
Comments from the former chairman of the Legislative Revenue Committee came over lunch and was consistent with his update on modernizing the tax structure. The goal is to make Nebraska more competitive, especially with young people between the ages of 18 and 34.
Blueprint Nebraska has developed a statewide strategic plan to grow the economy by attracting talent and encouraging business investment. This includes its vision for 2030 to “make Nebraska the most welcoming state in the Midwest for young people, talent, investment and commerce and a national model of continued growth and prosperity.”
Blueprint Nebraska plan proposes to reduce state income tax rates, completely eliminating state income taxes on income up to $ 50,000 – or $ 100,000 for married couples jointly filing – increasing property tax relief by an additional $ 2 billion over the next decade and eliminating Nebraska inheritance tax.
The changes would be funded by eliminating many sales tax exemptions, income tax deductions and corporate tax credits. The current sales tax rate would remain the same and the sales tax exemption for unprepared groceries and most medical services would remain in place.
Blueprint Nebraska’s alliance partners are the Platte Institute, Aksarben, and the Nebraska Chamber of Commerce.
Among other projections, it is expected to generate more than $ 2 billion in additional tax relief over 10 years and provide nearly $ 470 million in new revenue created by economic growth.
Among the questions asked was the type of reaction state senators have had so far.
Smith said the state has various tax proposals to consider, including a consumption tax that would propose eliminating taxes on property, income, sales, inheritance and inheritance.
âThere are challenges there because the devil is in the details,â he said.
And with surplus income next year, there might be an interest in lowering tax rates, Smith said.
With only a 60-day session next year, Smith said, it could be that the Blueprint Nebraska initiative will be introduced next year but not be implemented until 2023.
âWe have a new governor coming in,â Smith said. âI think maybe some of the lawmakers could mean, ‘We don’t want to tie (the new governor’s) hands. We do not want to implement any major tax reform. I wish I could tell you I’m an optimist, but I don’t think there’s much going to happen in 2022. I think it will happen in 2023, but until then I think we really need to control the narrative. of what we want the state to look like going forward.
Another reaction at the lunch included that removing the inheritance tax could be costly for counties and should be replaced if removed; and that state support should be increased for public schools, especially if property taxes are reduced.