Nebraska lawmakers have advanced to final-round debate a pair of tax relief measures called “transformative” and “historic” by Gov Jim Pillen.
Combined with Pillen’s plan to reduce property taxes by increasing state aid to schools, the 3 packages are estimated to provide $5.4-billion dollars in tax relief over the next 6 years.
LB 243 increases existing income tax credits for paid property taxes by $300-billion dollars over the next 2 years and limits school districts to a 3% increase in total dollars a year. The lid can be exceeded by a 60% vote of patrons or 70% vote by a school board.
LB 754 cuts the top income tax rate for both individuals and corporations from about 7% to just under 4% and speeds up the 100% exemption of Social Security payments from state income taxes – changes that total about $400-million over 2 years.
Both bills were trimmed to fit within state budget forecasts. Dropped were proposals to cut income taxes on business assets and research expenditures as well as temporary employees along with increasing the deduction for state and local taxes paid.
A package of tax credits for child care expenses and providers was reduced from $35 million dollars a year to $25 million a year.
Critics continued to warn that the cuts won’t be sustainable, but attempts to include economic triggers or a pause-and-review break in 2 years failed as did an effort to give a bigger tax break to middle-class Nebraskans.
The Unicameral is now on a 4-day weekend. When they return Tuesday, they’re expected to begin final round debate on a bill banning medical treatments for transgender youth that would be amended to include a ban on abortions after 12 weeks.