The chief sponsor of Gov. Dave Heineman’s proposal to abolish income taxes said Saturday he’ll ask the Revenue Committee to kill the bill. Omaha Sen. Beau McCoy says he talked to Heineman Saturday afternoon. Heineman spokeswoman Jen Rae Hein confirmed that the governor wanted to postpone action this year.
The governor had proposed abolishing Nebraska’s individual and corporate income taxes. He suggested making up for the lost revenue by ending sales tax exemptions on a wide range of items, including manufacturing components and ag inputs like seed and chemicals. Business and farm groups mounted heavy opposition to the plan.
McCoy said he will ask the Revenue committee to kill both the bill to abolish all state income taxes, and a smaller one that would have abolished only the corporate income tax, while lowering taxes on retirement income.
McCoy said officials had listened to people who advised against rushing into changing taxes. He said the Revenue Committee should broaden the discussion of possible tax changes to include sales taxes on services; property taxes, and economic incentives for businesses. He said he expects to ask the Revenue Committee to kill the bills next week.
Revenue Committee Chairman Sen. Galen Hadley told the Associated Press he wants to hold hearings across the state to gather Nebraskans’ input on tax modernization.