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Recent posts by Jordan Rasmussen

Unlikely partners work toward common sense tax solution

When Gov. Ricketts’ tax cut plans emerged at the beginning of the Nebraska legislative session, they appeared to set the stage for a classic rural-urban debate. The rural voice would coalesce around the need for agricultural land property tax relief while the more urban groups would call for their own form of property tax relief and the touted income tax cut.

Yet as the combined income and property tax cut bill known as LB 461 emerged from committee and to the floor for debate, there was a uniquely unified voice among constituent groups.

Exploring growing taxes on Nebraska farms

How does Nebraska’s tax burden balance out?

A recent report from the Center for Rural Affairs explores the tax burden in 13 Nebraska counties. Using data from the Nebraska Department of Revenue, the Center compared income, property, and agricultural property tax trends over a 10-year period. While income tax revenue remained steady, there was a dynamic and growing shift of Nebraska’s tax burden onto agricultural property taxpayers.

Growing taxes on Nebraska farms

The need for property tax relief in Nebraska has been well documented. In 2017, a coordinated effort to bring income tax reductions back into the Nebraska tax policy conversation gained steam. Also in consideration is a projected budget shortfall of nearly $900 million. 

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Why does Nebraska’s current tax debate matter?

Nebraskans are left to sit upon an unbalanced three-legged tax stool.

The property tax leg is too long, representing more than 35 percent of the state’s tax revenues. The income tax leg of the stool is too short, reflecting 27 percent of state revenue. Sales tax accounts for 30 percent and the remaining 8 percent comes from other sources.

Proposals before the Legislature seek to shift this balance, but in a manner that could leave middle and low-income Nebraskans with access to fewer services while shouldering a greater percentage of the tax burden.

Too many unknowns in the property tax cut proposal

The Nebraska Legislature is scheduled to begin debate on LB 461 later this week. Tucked within this compilation bill, posed to cut income and corporate tax rates, is a proposal to change the way agricultural and horticultural land is valued.

While this change in ag land valuation is positioned as the property tax relief Nebraska’s agricultural community has been calling for, rural and urban residents alike should be wary.

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