Utah begins special session on tax reform
Unfortunately, it’s not Nebraska that’s called a special session on taxes – it’s Utah!
Utah has the nation’s 9th most favorable tax climate and one of the fastest growing economies in the nation – so what more is there to change? Well, research has shown that the state relies too much on the income tax and they want to change some of that and re-balance their tax system to be EVEN MORE competitive.
The plan is to broaden the sales tax to include items and services that were previously exempt and reduce both personal and corporate income tax rates.
According to estimates by the Tax Foundation, “the sales tax base broadening provisions are expected to raise $501 million, while the income tax provisions—including the earned income tax credit and grocery credit—will cost $581 million, for a net tax cut of about $80 million”.
Both Utah and Nebraska have been debating tax changes over the last year (or longer). The difference is that Utah lawmakers have come up with a plan and they expect to see some action whereas the Nebraska lawmakers still cannot come to an agreement about property taxes.
The Utah plan is not without its opposition. The Lieutenant Governor, who is running next year for governor, disagrees with the special session. Yet the Governor, Senate President and House Speaker all agree that “a special session is the ideal setting to consider a bill of such significant complexity.”
Hopefully Nebraska lawmakers will take a look at what Utah is doing and make some changes to help make Nebraska more competitive from a tax perspective.