The Nebraska Chamber of Commerce and Industry is pushing for tax relief during the upcoming legislative sesssion.
Jamie Karl, the Chamber’s vice president of public affairs and policy, says the state’s individual income tax rate is too high.
“If we were able to lower Nebraska’s high income tax rate of 6.84% to just below 6%, we would move from the nation’s 15th worst individual income tax to roughly somewhere in the middle,” Karl tells Nebraska Radio Network. “That would definitely make Nebraska more competitive.”
Karl says the Chamber also wants to see the corporate income tax rate lowered from 7.81 percent to match the top individual income tax rate.
Among neighboring states, only Iowa has a higher corporate rate, while South Dakota and Wyoming have none.
“After this major rewrite of federal tax code, all 50 states could be having a state tax policy debate this year,” Karl says. “To be competitive, Nebraska is going to have to address that high tax burden at both the corporate level and individual level.”
Colorado’s corporate income tax rate of 4.63% would be the third other neighboring state to be lower than Nebraska’s, if it moved to a 6% rate.
Karl says even with the recent decline in state revenue, tax relief makes sense.
“That’s a steep hill to climb, when you’re facing a downturn in revenue, but if you get more business activity, more people moving into the state, that is going to be reflected in more state revenue,” he explains.