Recently, Governor Heineman announced a proposal to eliminate both corporate and personal income tax and many sales tax exemptions in Nebraska. This bold new plan is long overdue in a state with prohibitively high taxes, particularly compared to the surrounding low tax states.
Nebraska needs to reposition itself not only for regional competition, but for global competition, as well. And, like it or not, this Great Recession is reshaping the local, national, and world-wide economy for all. Individuals, localities, and states must change with the times or go the way of a Detroit or the travel agent (with no offense to either – these are just tough times).
By restructuring the tax policy in Nebraska, the Governor and the legislature can reposition Nebraska for future growth. We must be a state that retains our brightest graduates and attracts people and businesses to live, work, and stay here. Currently, that is not happening as much as it should. Our rural populations are dwindling and our cities populations have stagnated. It is time to throw off the policies of the nineteenth century and adopt the policies that work for these new economic times.
For instance, Nebraska has been in a rural vs. urban tug-of-war for years. This must stop. Agriculture and urban interests must learn to cooperate for the greater good of the whole state. Every interest, farming, manufacturing, corporate, and labor, must give up some outdated special treatment in exchange for future growth. Pitting interests against each other is a failed, but all too common, practice in this state. Having a thoughtful and honest conversation about taxes will lead us to a more meaningful understanding of these relationships.
To begin with, the Omaha-Lincoln corridor cannot pay the freight for the rest of the state. Smaller communities must deal with their declining populations realistically. No one wants the state to empty out and it is in everyone’s interest to maintain a balance, but efficiencies must be found in the rural areas. Likewise for agriculture – no one wants to abandon this time honored livelihood, but taxpayers cannot subsidize these operations.
Likewise, while Omaha may be entitled to keep more of its bounty, that city must put its economic house in order. You cannot expect the rest of the state to take cries of “poverty” seriously when you give your retiring superintendent a million dollars plus payout or pay 3 police chiefs under 50 years of age $10 million dollars in retirements. You cannot give teachers, firemen, and police $100,000 “sick bank” payouts. Nor can you give the Medical Center a huge payout for a Cancer Center that its own Foundation didn’t pay for and then claim you have no money for county services. This folly must stop.
Everyone, every industry and interest, must take a fair and realistic look at their own tax and revenue transgressions and true needs as we debate the Governor’s visionary new proposal. The Omaha Alliance is a collection of small business taxpayers – we must succeed for all to succeed. We advocate for good, smart government, which critically includes sound tax policies. This is especially true for “little guy” amid the big lobbying, special interests in this debate. There is concern over what these special interests may lose, but there is much more to be gained for all. (See, http://www.platteinstitute.org/blog/detail/the-benefits-of-eliminating-the-income-tax
The Governor is giving this state an opportunity to reexamine our statewide commitment to fair, sound, just taxation. We must take it. Let’s all roll up our sleeves and do the hard work of working through this discussion. It will benefit all of us in the long run. The Omaha Alliance wholeheartedly supports the Governor’s efforts.
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