Blueprint Nebraska Outlines Tax Modernization Plan


Jim Greisch, national industry leader for financial services at RSM US LLP, upper right corner, speaks during a Zoom news briefing Thursday, March 4, 2021. (Blueprint Nebraska)
By 
Scott Stewart
The Daily Record

Blueprint Nebraska is pushing for a “bond and robust plan” to modernize Nebraska’s tax code, arguing doing so is essential for the health and competitiveness of the state’s economy.

Tax policy isn’t the only priority for growing the economy, but it’s a key component of Blueprint Nebraska’s strategy for encouraging business investment and attracting talent. The organization’s initiatives are grouped into four broad themes: people, places, government and industry sectors.

“It quickly became clear through the Blueprint Nebraska engagement process that Nebraska’s tax system isn’t doing us any favors – whether you are a producer, business owner, private homeowner or you live in rural or urban Nebraska,” said Jim Smith, president of Blueprint Nebraska.

The modernization proposal was outlined in a news briefing Thursday that included Revenue Committee Chairperson Sen. Ann Linehan, Sen. Tom Briese and academic and industry experts. Among the strategies legislative leaders are asked to consider are:

• Long-term funding for property tax relief;

• Simplifying income taxes to stimulate growth; and

• Aligning economic incentive programs with Blueprint initiatives.

The organization is also encouraging the use of regional economic modeling to study and determine the best modernization tactics, including elements of broadening the state’s sales tax base, according to a news release.

“The status quo just isn’t cutting it anymore anywhere,” said Jim Greisch, chair of Blueprint Nebraska’s Taxation and Incentives Industry Council and a partner at RSM US LLP. “We wasted no time researching our options. At the end of the day, how well our tax code promotes growth is fundamental to our ability to grow jobs, attract young talent and pursue our vision of strong communities.”

In reviewing Nebraska’s current overall tax framework, Blueprint Nebraska observed that:

• The top 10% of income earners pay more than half of the state’s individual income taxes, with its effective income tax rate for the top 10% nearly tripling those of the bottom 70%.

• Three-quarters of nearby states have less of a corporate tax burden than Nebraska, which has a top corporate rate of 7.81%.

• All of Nebraska’s peer states have lower property taxes, representing a burden of $39.19 per $1,000 of personal income on average.

• The state’s sales tax base has declined by nearly half since 1970, partly due to the state’s exemptions, and goods have declined as a percent of total consumption by nearly 30% since the 1950s.

Greisch said Nebraska needs to consider how it will be attractive to the workforce of tomorrow, not those of the 1960s. The drivers of the economy have changed, so the way the economy is taxed should change.

“We have to create a system that treats all taxpayers in a comparable manner, and of course we have to protect those in our economy who are the low income earners,” Greisch said. “We surely cannot shift any burden down into the lower income levels.”

Watch Blueprint Nebraska’s briefing on tax modernization proposals at youtu.be/WDJBVTZFVDY.

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