State lawmakers seem willing to authorize a study of the state tax system, but that doesn’t mean that tax cut proposals won’t be considered this session as well.
The Unicameral has advanced LB 613, which would establish a special commission to conduct a thorough study of the state tax code.
The legislation grew out of opposition to LB 405 and LB 406. The more ambitious of the two bills sought an exchange of the state income tax for the elimination of certain sales tax exemptions. It ran into fierce opposition from business and agricultural groups that claimed it would reduce profits for Nebraska businesses and farms and make both less competitive than in other states.
Sen. Beau McCoy of Omaha carried the two bills for Gov. Dave Heineman and agreed to drop both in exchange for a study of the tax system.
Still, proposals to cut various taxes will come before legislators as well.
“Well, I think there’s going to be some very broad, conceptual ideas that we are going to explore through a tax study and then there are going to be some things that we could or should do this session,” McCoy says.
McCoy says the legislature is likely to consider tax breaks for retirees and a bill that would exempt agricultural parts from the state sales tax.
Sen. Annette Dubas of Fullerton sponsors the tax break for ag parts, LB 96. She doesn’t expect it to be approved this session, but rather included in the discussion by the tax commission.
“If we’re going to have the debate, it’s going to come down to what priorities do the senators feel need to be there and what needs to be addressed,” Dubas says.
AUDIO: Brent Martin reports [:45]