Gov. Ricketts, Top Senators Meet With NFIB Members

State’s chief executive and leading lawmakers press case for tax reform at Small Business Day at the Capitol event

NFIB/Nebraska State Director Bob Hallstrom reports from Lincoln on the small-business agenda for the legislative week ending April 14.

Lawmakers adjourned April 14 for the long, four-day Easter Holiday weekend. When the Legislature reconvenes April 18, it will begin debate on a series of property tax/state aid to education measures.

Speaker of the Legislature Jim Scheer (Norfolk) has announced a schedule of “late night sessions,” in which floor debate could extend until around 9 p.m. or later to ensure adequate time for lawmakers to address the state’s biennial budget and remaining priority bills. Late night sessions have been scheduled for the following dates:

Wednesday, April 19
Wednesday, April 26
Tuesday, May 2
Wednesday, May 3
Thursday, May 4
Monday, May 8
Tuesday, May 9
Wednesday, May 10
Monday, May 15
Tuesday, May 16
Wednesday, May 17;
Tuesday, May 23
Wednesday, May 24.

Tax Relief Scheduled for Floor Debate April 21

Speaker Scheer has announced his intention to begin first-round debate of a comprehensive tax relief package (Legislative Bill 461) April 21. The measure contains provisions changing the manner in which agricultural land is valued for tax purposes and reduces individual income taxes and corporate taxes over time. LB 461, as amended, would address the following:

AG LAND VALUATIONS — The state, in 2018, would revise its method for valuing agricultural land for tax purposes, by use of an income capitalization method that reflects the agricultural-use value in the ordinary course of trade. Annual aggregate increases in ag land valuations would be capped at 3.5 percent beginning in 2018. The measure would also ensure that capitalization rates result in aggregate agricultural-use values for any class of agricultural land between 55 percent and 65 percent of the actual value that the land has for agricultural or horticultural purposes.

TOP INDIVIDUAL INCOME TAX BRACKET — Beginning in 2020, the top individual income tax rate would be incrementally reduced from 6.84 percent to 5.99 percent in eight annual steps, with each “reduction” only occurring if state revenue growth exceeds 3.5 percent. If the expected rate of growth is not met, the tax rate reduction that would have otherwise occurred will be deferred.

TOP CORPORATE TAX BRACKET –– The top corporate income tax rate would be reduced from 7.81 percent to 7.59 percent beginning in 2019, with the top rate to continue to be reduced for subsequent tax years in increments of 20 percent each year until the top rate reaches 5.99 percent. Reductions would only occur if state revenue growth exceeds 4 percent. If the expected rate of growth is not met, the rate reduction that would otherwise occur is to be deferred.

NFIB/Nebraska is supporting passage of the tax relief contained in LB 461 for the following reasons:

The legislation represents a comprehensive and balanced tax relief plan that provides meaningful income and property tax relief for small-business owners who create the majority of new jobs in Nebraska.

The level of income taxes and property taxes in Nebraska make us uncompetitive and creates an environment that is not conducive for the retention of existing businesses or for attracting new businesses to our state.

The tax relief provided under LB 461 will spur economic growth by providing additional incentives for small businesses to expand and create new jobs in Nebraska.

Small Business Day a Big Success

Gov. Pete Ricketts and Sens. John Stinner, chairman of the Appropriations Committee, and Jim Smith, chairman of the Revenue Committee, addressed an April 12 gathering of entrepreneurs at NFIB’s annual Small Business Day at the Capitol.

Major issues addressed were the budget shortfall, income and property tax relief (see above) and regulatory relief. Governor Ricketts touted the need for comprehensive tax relief for the middle class, and Senator Smith highlighted reductions in both the top individual and corporate income tax rates contained in Legislative Bill 461, if state revenues grow sufficiently. The measure would also provide for reductions in property taxes on agricultural land.

Small Business Day at the Capital was co-hosted by NFIB, Nebraska Chamber of Commerce and Industry, the Greater Omaha Chamber of Commerce, the Lincoln Chamber of Commerce, Lincoln Independent Business Association and Nebraskans for Workers’ Compensation Equity and Fairness.