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Governor asks for tax relief
January 23, 2014 Jerry Purvis   

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Photo by Jerry Purvis/Gering Citizen - Nebraska Gov. Dave Heineman made a stop in Scottsbluff last week to explain his plan to make $500 million available for tax relief over the next three years.

Governor Dave Heineman made a stop at the Western Nebraska Regional Airport last week to outline his plan to make $500 million available for tax relief.

“We’re one of the 13 highest property tax states in America,” he said. “We’re also one of the 16 highest income tax states. We really need to do a better job about lowering taxes.”

He said he was concerned about high taxes because it impedes the future. “How do we grow more jobs for our young people and for middle class families?” he asked. “When you’re paying higher taxes, it isn’t going to happen.”

High property taxes are the most pressing concern among state residents, especially in rural areas where agriculture is so important. That was underscored by the findings of the Legislature’s Tax Modernization Committee, which help public hearings across the state last fall.

Heineman said that over the last decade, median incomes in Nebraska have declined and middle class take-home pay is down. And he emphasized the Legislature can change that by lowering taxes.

Heineman said he supports a proposal from the Nebraska Farm Bureau and the Nebraska Cattleman’s Association to lower the valuation on ag land from 75 to 65 percent. He also supports lowering the income tax rate from its current 6.84 percent, while some bordering states have no income tax at all.

“This isn’t about lowering taxes just for the sake of lowering taxes,” Heineman said. “This is about creating more jobs, higher paying jobs to keep our young people here in the state.”

He said too many in government always ask whether we can afford it when it comes to tax relief. Yes, they never ask that question when it comes to raising taxes.

Using the Legislature’s own numbers, the governor said the state’s current cash reserved fund is currently at a record of $722 million. A transfer of $220 million over the next three years would still leave $500 million in the reserve, more than enough to meet the state’s annual budget of around $4 billion.

He added tax relief could be realized by holding the line on spending. The Legislature’s current estimated spending increase of 4.7 percent would result in $370 million available for tax relief over the next three years.

“I also found out the state has $1.2 billion in cash in its checking and savings account,” he said. “That means we’re overtaxing you right now.”

Heineman also touched on the status of healthcare in Nebraska. “The required parts of Obamacare are going to cost the state over $200 million over the next six years,” he said. “That’s money we should be using for education or job creation.”

He said some state senators are trying to increase the state’s Medicaid obligation, which is an optional part of the Affordable Care Act. The governor said that would mean less funding for the schools and the state’s colleges and universities.
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