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Easing the Tax Burden

By Governor Pete Ricketts
September 28, 2015

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One of the primary focuses of my administration has been providing meaningful tax relief for hardworking Nebraskans.  Whether I am visiting with ranchers at a coffee shop in Chadron or a small business owner at a town hall event in Falls City, I hear firsthand how Nebraska’s high taxes impact communities, businesses, and families across our state.  Easing tax rates even slightly can make a big difference because it keeps more of your paycheck in your pocket.  It helps the small business owner who is looking for a way to expand their operation or the family trying to find enough money in their budget to make their rent or mortgage payment.

These are the type of stories that motivated me to make property tax relief my number one focus this past legislative session.  Our efforts were met with success, and my proposal to deliver over $400 million in property tax relief – an over 45% increase over past budgets – through the Property Tax Credit Relief Fund received legislative approval.  This will provide tax relief for all Nebraska property owners.  The tax credit will be applied to your tax bill directly, and many will see the credit noted on their bills for their 2015 property taxes.

While this tax relief was significant and a step in the right direction, there is more still to be done.  The Tax Foundation’s 2015 State Business Tax Climate Index ranks Nebraska as 29th best in overall tax competitiveness as well as 12th highest in property taxes and 26th highest in income taxes.  These rankings show that Nebraska is a high tax state, and is, at best, middling when compared to other states.  There is nothing competitive about being middle-of-the-pack, and we must continue to look for new ways to bring tax rates down so that we can provide tax relief that will keep hardworking families here in our state and create more high quality jobs.

Right now, members of the Legislature are studying education funding and property taxes to develop proposals for the upcoming legislative session.  Last year, numerous proposals to make structural changes to how we levy property and income taxes were introduced by senators, however, no proposals that provide long-term structural relief advanced from the Revenue Committee.  This fall, senators have already discussed a wide variety of potential tax reforms ranging from a property tax revenue freeze to calculating land valuations on a 10-year average instead of the current 3-year average.  The conversation has only just begun, and senators will welcome your input as they continue to talk about potential proposals that could impact your tax bills.

As we approach next year, my team is working with legislative groups interested in tax reform, talking to tax experts, and preparing tax reform proposals.  In the coming weeks and months, I would encourage you to share your property tax bill with your local and state representatives as you have conversations with them.  Because property tax is a locally administered tax, long-term relief will require cooperation from both state and local government.  As we continue to look for ways to improve Nebraska’s tax competitiveness,I hope that you will share your ideas on tax reform with my office at pete.ricketts@nebraska.gov and 402-471-2244.

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