A $97 million tax cut proposal is on the threshold of passing in the legislature.
State lawmakers have advanced the scaled down version of Gov. Dave Heineman’s top priority in this legislative session. LB 970 needs to clear a final vote to move to the governor’s desk.
Heineman initially called for a $326 million reduction in personal income taxes, corporate taxes and the inheritance tax. Legislative leaders raised concerns about whether the state budget, emerging from the effects of the recession, could afford the loss of revenue. Negotiations reduced the cost of the total package twice, settling at a total of $97 million over three years. Once fully implemented, taxes would be reduced by $55.6 million annually.
Proposed cuts to those in the top tier of the state personal income tax bracket and to the corporate income tax were dropped. The proposal to eliminate the inheritance tax, collected by the counties, was dropped as well.
Though negotiations reduced the package by about a fourth, it still had its critics in the legislature. The leading critic, Sen. Danielle Conrad of Lincoln, stated during legislative floor debate that the state budget couldn’t afford a loss of revenue.
“But, I contend 25 or 30% of a bad deal is still a bad deal for our kids, for our future, for the elderly, for the disabled, for responsible budgeting and sound policy,” Conrad stated.
Conrad also criticized the legislature for cutting off debate on the tax cut package after only an hour and a half, stating that was too short a period of time to debate what some considered the most important piece of legislation to be debated this session.
AUDIO: Sen. Danielle Conrad protests the tax cut proposal during floor debate [7:30]