While Nebraska’s economy remains reliant upon agriculture, the broader economy, following national trends, has moved away from a dependence on manufacturing and goods to knowledge and service. Nebraska’s tax code does not reflect that decades long trend.
The prior economic mix meant the state did not need to tax seldom-used service. Despite this shift, sales tax exemptions for services, such as dry cleaning and landscaping, remain in the state’s tax code. This array of exemptions has imbalanced the three legged tax stool, leaving it leaning heavily upon property taxes.