Gov. Heineman, Senator McCoy and Senator Ashford Testify on Behalf of Nebraskans and Small Businesses

LB 405 would eliminate the personal income tax and corporate income tax (Lincoln, Neb.) 100 Next Generation Ideas (pdf) , LB 405 Testimony (pdf) Gov. Dave Heineman today testified in front of the Revenue Committee on Legislative Bill 405. LB 405, introduced by State Senator Beau McCoy and State Senator Brad Ashford, both of Omaha, would eliminate approximately $2.4 billion in sales tax exemptions and the total elimination of both the individual income tax and the corporate tax. Additionally, Gov. Heineman highlighted the state chamber’s 100 Next Generation Ideas which calls for the elimination of the income tax in Nebraska. Gov. Heineman specifically pointed to the following: 25. Getting rid of the state income tax would help put money into everyday businesses, attract retired people and make the Nebraska way of life even better. 26. Implement a flat tax for income tax purposes in Nebraska eliminating most, if not all, deductions. 96. Eliminate state income tax on social security in Nebraska to help attract and retain seniors. Gov. Heineman also highlighted the statement by Nebraska Chamber of Commerce President Barry L. Kennedy who said, “Strong economics and prosperous communities do not happen by accident. They are the result of bold ideas, hard work and constant vigilance.” Bryan Health President, Kimberly A. Russel said, “We believe the 100 Next Generation Ideas, when implemented, will strengthen communities throughout our state and will create new opportunities for future Nebraskans.” Excerpts from Gov. Heineman’s testimony are as follows: “This is about our future, not the past. “We need a modern tax system to create more jobs and higher paying careers for our sons and daughters, and our grandkids. “The State of Nebraska provides $5 billion in sales tax exemptions. Nebraska exempts more than we collect. “If we eliminated just half of the current exemptions, Nebraska wouldn’t need to have an individual income tax or a corporate income tax. “More and more Nebraskans are telling me that we should eliminate all $5 billion of sales tax exemptions. That would be fair to everyone. “If you did that, you could eliminate the state income tax and you could lower the sales tax rate to approximately 3.5%. “For example, why is Lozier exempted from paying sales tax on the energy they use, but First Data, Hy-Vee, Pay Pal, Mutual of Omaha, Hawkins Construction, Omaha Steaks, Nebraska Furniture Mart, Runza, The Buckle, TD Ameritrade, Marriott, Cash Wa, BD Construction, Cedar Rapids State Bank, First National Bank, Ameritas, Union Bank, Oriental Trading, Cabela’s and most other businesses in Nebraska have to pay sales tax on the energy they use.” Excerpts from Sen. McCoy’s testimony are as follows: “The four most important reasons why I am enthusiastically engaged on the issue of tax reform sat across from my wife and I at breakfast this morning. I want our four kids, and all children across Nebraska, to have more and better opportunities than we have had to live, start a business and raise a family in our state. I want our retirees, like my parents, and retired veterans to stay in Nebraska and continue to contribute to our communities. “There is a reason why Nebraska is The Good Life. We have the ability, opportunity and responsibility to create positive change and make Nebraska, The Best Life. But we need to insure the 1.8 million hard working Nebraskans that deserve tax reform are not forgotten. “I’m a small business owner in the construction field now, but I was born and raised as a fourth generation ranch kid on our family’s cattle ranch near the Nebraska/Colorado border. Agriculture is in my blood, it’s part of who I am. “When I was sixteen, I didn’t buy a car, I bought a tractor. I did this so that my brothers and I could start our own haying business and put ourselves through college. “Farming and ranching are not just industries in our state they are a proud way of life and the bedrock of Nebraska. “We should do everything we can to protect and promote agriculture and manufacturing through this tax reform discussion, and we will.” Excerpts from Sen. Ashford’s testimony are as follows: “There is a time and place to incent businesses directly, as we did with LB 775 and the Nebraska Advantage Act. Those two measures have moved Nebraska ahead as more viable. “A sales tax on services and corporate income tax rather than manufacturing input tax is a good option but this is up to you. “For the employers who choose to locate here let’s make it easier for them to attract quality candidates. We have helped some large business owners; now we need to help the employees. “We must turn our attention and focus to the hard working citizens of our state paying income taxes, when we are developing a solution to help our constituents.