Throwback Thursday: A Balanced and Fair Tax System for Nebraskans

The final report of a Center for Rural Affairs Task Force on Nebraska tax reform is as relevant today as when it was published in January 1992. In fact, when Traci Bruckner testified to the Nebraska Legislature Revenue and Education Committee in November on changes to the state's tax system for the Center, she referenced the task force report.

Traci said, "In 1992 the Center conducted a comprehensive study of the state’s tax system and made recommendations for improvement. We're disappointed to find that in 2015 many of the exact same inadequacies that were crippling then are still in place." 

Here's the #tbt gem worth remembering. The task force found that Nebraska's tax system suffered from three major faults.

  1. Nebraska depends too heavily on property tax. It provided 46% of all state and local revenue in 1990. Now in 2015, 48% of education funding comes through the property tax. 
  2. Nebraska's overall tax system is too regressive, both because it depends too much on property and sales taxes, and because its income tax system does not ask the wealthy to carry their weight.
  3. Nebraska's sales tax base is too narrow, exempting more of the rapidly growing service sector except those service which are most widely consumed by low and moderate-income people.

Do you recognize any of these faults in your state's taxes? If so, take some encouragement from Clark Nichols, the Chair of the Task Force. He outlined a critical point in his introduction to the report.

"In all our work, this diversity of views and interests [on the task force] represented a blessing, not a curse. We feel strongly that tax issues in Nebraska are too often wrongly perceived as separating along urban versus rural lines. While our task force did not always agree, our differences were constructive and led to fruitful dialogue that demonstrated clearly that deeply held values such as balance, fairness, and mutuality, ultimately overwhelm petty self-interest."

If we all remember to work from these values, there's a much better chance that our tax systems will be balanced and fair. Elected representatives, are you listening?

You can see Traci's testimony to the Revenue committee here, and A Balanced and Fair Tax System for Nebraskans here.