Nebraska has the opportunity to become the next state to carry the torch of tax reform as the states legislature gears up to debate a bill this Friday that, if enacted, would provide needed relief to taxpayers and improvements to Nebraskas tax code. <\/p>\n
LB 461, which recently passed out of committee, would lower the top personal and corporate income tax rates from 6.84% and 7.81%, respectively, to as low as 5.99% by 2029, so long as certain revenue triggers are met. <\/p>\n
Across the country, recent years have proven to be a golden age for pro-growth tax reform. States like Texas, Tennessee, Arizona, Arkansas, Wisconsin, and especially North Carolina have all enacted policies that have resulted in lower taxes, allowing residents to keep more of their hard-earned income. States that fail to improve their codes and provide relief to taxpayers are being left behind in the competition for investment, employers, jobs, and people. By enacting LB 461, Nebraska legislators can ensure the Cornhusker State will not be left behind. <\/p>\n
According to ALECs 2016 economic outlook index, Nebraska is dismally ranked 32nd in the nation. In fact, all of its neighboring states, from Wyoming (4) to Iowa (29), are ranked as more economically competitive. Passage of LB 461 will help Nebraska close this competitiveness gap. Today, Americans for Tax Reform sent the following letter Nebraska lawmakers calling on them to enact rate reducing tax reform by voting Yes on LB 461: <\/p>\n
Dear Members of the Nebraska Legislature, <\/p>\n
On behalf of Americans for Tax Reform (ATR) and our supporters across Nebraska, I urge you to support LB 461. Nebraska currently has a top personal income tax rate of 6.84% and 7.81%. LB 461, if enacted, would reduce those rates by 12.4% and 23.3%, respectively, taking both rates down to as low as 5.99 percent by 2028, so long as revenue triggers are met. <\/p>\n
There is ample evidence that lower tax rates make states more competitive, and more conducive economic growth. John Hood, chairman of the John Locke Foundation, a non-partisan think tank, analyzed 681 peer-reviewed academic journal articles dating back to 1990. Most of the studies found that lower levels of taxation and spending correlate with stronger economic performance. When Tax Foundation chief economist William McBride reviewed academic literature going back three decades, he found the results consistently point to significant negative effects of taxes on economic growth, even after controlling for various other factors such as government spending, business cycle conditions and monetary policy. <\/p>\n
As the Platte Institute has reported, Nebraskans face a higher burden than taxpayers in competing states: <\/p>\n
On average, taxpayers in Nebraska pay 52 percent more personal income tax per person, and 36 percent more corporate income tax. Thats $1,125 per person per year in Nebraska versus $541 in the five rival states [Texas, Florida, Arizona, Colorado, and Iowa] for personal income taxes. <\/p>\n
If that werent bad enough, your constituents have been hit with 20 federal Obamacare tax increases over the last eight years. As such, individuals, families, and employers across Nebraska are greatly in need of the sort of income tax relief that enactment of LB 461 would provide. <\/p>\n
A reduction in the personal income tax would allow taxpayers to keep more of their hard-earned income, while increasing the job-creating capacity of small businesses that file under the individual income tax system.Meanwhile, a corporate rate reduction would make Nebraska more attractive to employers, job creation, and investment. Corporate tax relief will benefit the broader populace, as the burden of corporate taxation is borne by people in the form of lower wagers, fewer job opportunities, and reduced returns on savings and investment. Enactment of the type of rate-reducing tax reform found in LB 461 would helpNebraska compete with the likes of Texas, Oklahoma, Colorado, North Carolina, Florida, Arizona and other competitor states that already boast lower tax burdens and more hospitable business tax climates than Nebraska. <\/p>\n
North Carolina provides a great example of how much progress can be made in a short period of time, and should inspire those seeking to provide relief to Nebraska taxpayers while improving the state tax code. Just four years ago, North Carolina had the highest personal and corporate income tax rates in the Southeast. Thanks to tax reform measures enacted in 2013 and 2015, North Carolina now has a flat personal income tax rate that is the lowest in its region, with the exception of Florida and Tennessee, which do not levy an income tax. North Carolinas present corporate tax rate, at 3%, is now less than half of what it was just four years ago, and the personal income tax rate has been reduced by nearly 30%. <\/p>\n
In addition to having the lowest personal income tax rate in the region, North Carolina now has the lowest corporate rate in the nation among states that levy such a tax. Going into 2013, North Carolina had the 44th ranked business tax climate in the country on the non-partisan Tax Foundation's business tax climate index. Thanks to the reforms enacted since 2013, North Carolina now has the nations11th best business tax climate.This remarkable improvement in North Carolinas tax code was achieved with the same sort of revenue triggers that LB 461 uses to provide tax relief for Nebraskans in a fiscally responsible fashion. <\/p>\n
Americans for Tax Reform urges you to vote YES on LB 461. ATR will be educating your constituents and all Nebraskan taxpayers as to how lawmakers in Lincoln vote on LB 461 and other important fiscal and economic matters throughout the legislative session. Please look to ATR to as a resource on tax, budget, and other policy matters pending before you. If you have any questions, please contact Patrick Gleason, ATRs director of state affairs, at (202) 785-0266 or pgleason@atr.org<\/a>. <\/p>\n Sincerely, <\/p>\n Grover G. Norquist <\/p>\n President <\/p>\n Americans for Tax Reform <\/p>\n <\/p>\n See more here: <\/p>\n "The Restoring Americans' Healthcare Freedom ...<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" Nebraska has the opportunity to become the next state to carry the torch of tax reform as the states legislature gears up to debate a bill this Friday that, if enacted, would provide needed relief to taxpayers and improvements to Nebraskas tax code. LB 461, which recently passed out of committee, would lower the top personal and corporate income tax rates from 6.84% and 7.81%, respectively, to as low as 5.99% by 2029, so long as certain revenue triggers are met. Continue reading