Jim Pillen’s property and sales tax plan
Tax plans receive approval and changes
Within the past year, Nebraska Governor Jim Pillen and his office have lobbied for tax changes within the system. Specifically, property and sales taxes. Pillen’s plan was to attain a 40 percent total property tax relief by the end of his second year in office. On Aug. 20, Legislative Bill (LB) 34 otherwise known as “Adopt the Property Tax Growth Limitation Act and the School District Property Tax Relief Act and change provisions relating to revenue and taxation” was approved by Nebraska lawmakers. This was done during a special session after four months of discussion and consideration. The passing of LB 34 provided Nebraska schools with $185 million in new school tax relief, which the majority of will be paid through budget cuts.
During the summer, as many as 200 goods and services were exempt from Nebraska sales tax. The plan for this was to eliminate some exemptions in order to help achieve 40 percent property tax relief. The rundown of events were as follows. From May to June, all sales tax exemptions, with the exception of food and medicine, were subject to possible repeal, according to Pillen. Legislative Bill 388, on the other hand, had six exemptions: dry cleaning, soft drinks, confectionery, lottery tickets, pet veterinarian services, animal grooming (apart from livestock) and soft drinks. This bill failed in the spring of 2024. From July all the way to August, more exemptions were selected for removal as time progressed. The amount of exemptions started at 200 then to 124, and slowly decreased over time until eventually no exemptions were removed at the time of the bill’s passing.
It should also be noted that while the bill was passed, there are still concerns among the people about how this bill would affect daily life. Specific groups who are worried about the bill are apartment renters. According to State Sen.Merv Riepe, he is concerned that people who rent might not get a direct tax advantage from any plans. Some farmers who are serving within the legislature have also expressed their concerns over Pillen’s suggestion of adding a sales tax to agricultural inputs, such as vital raw materials that are used within the agricultural field. State Sen. Barry DeKay of Niobrara also added, “Taxing the inputs is going to be the death of some or maybe a lot of young farmers, especially the ones that don’t have land.” It is also said that future changes might take place depending on how the newly passed bill performs.
by Robert Tengker