With the threat of a budget shortfall looming over senators’ heads in the Nebraska Legislature, lawmakers are scrambling to figure out what to do next in order to make up for state spending that is projected to outpace revenue. Nebraska, which heavily depends on its agricultural industry, is looking at a struggling farm economy as well as an over reliance on tax collections from an economy that is growing unevenly.
One solution that could help stimulate Nebraska’s economy is to lower property taxes. By lessening the burden being felt by property owners across the state, Nebraska would be putting money back into the pockets of its residents, allowing families and businesses to invest more into their communities. Families can begin to spend money in stores and restaurants; local business can begin to grow, create new jobs, or provide more opportunities to their employees; and other businesses and families can begin to invest in Nebraska as an affordable place to start a business and live. All of which will jumpstart Nebraska’s economy.
However, as the current tax system is structured, property owners, home owners and business owners combined are forced to provide nearly 50 percent of the revenue for state and local governments through property taxes. Income taxes only make up 33 percent and sales taxes 19 percent. By creating a more balanced tax system, similar to a three-legged stool, our state’s revenue would be more stable, having a consistent source that is not too heavily reliant on one tax. But this cannot be accomplished without our lawmakers passing legislation that includes comprehensive property tax reform for all of Nebraska.
As we mentioned last week, two bills LB640 and LB461 fall short of accomplishing property tax reform that is being demanded throughout the state. In fact, in a recent tele town hall hosted by Reform for Nebraska’s Future, a poll concluded that 78 percent of Nebraskans see property tax reform as the number one priority.
Without relief, Nebraskans will continue to feel the burden of increasing property taxes not only in their day to day lives, but throughout the state’s economy. By stabilizing our tax system, lawmakers have an opportunity to fix issues that have resulted from an unfair process.
If you wish to learn more about why LB640 and LB461 are not the answer for Nebraskans read our report card here.
You can also help out by sending a letter to your senator telling them why property tax reform is so important.