Tax modernization commission plan advanced

After several days of discussion, senators gave first-round approval March 20 to a bill that would establish the Tax Modernization Commission to review and recommend updates to Nebraska’s tax code.

Under LB613, introduced by Columbus Sen. Paul Schumacher, the commission would continually review and recommend updates to Nebraska’s tax code. Schumacher said the Legislature needs to take a step back and look at tax policy as a whole.

“This is far more complex and involved, dealing with so many interests, that we need to pause for a moment,” he said. “We need to try to figure out in the long term what is right for the people of Nebraska and what will hopefully serve the state as long as the current system.”

An Executive Board amendment, adopted 47-0, replaced the bill.

As amended, LB613 would direct the commission to consider fairness, competitiveness, simplicity and compliance, stability, adequacy and complementary tax systems as it evaluates Nebraska’s current tax code.

The commission would comprise the speaker of the Legislature and members of the appropriations, health and human services, revenue and legislature’s planning committees.

Ex-officio members would include the Legislature’s fiscal analyst, tax experts from the University of Nebraska and the tax commissioner and property tax administrator from state Department of Revenue.

Under the bill, the commission would provide a preliminary report to the Legislature and the governor by Dec. 15, 2013, and a final report would be due by Nov. 15, 2014. The commission would continue to meet at least once per year to review and evaluate the tax code.

Kearney Sen. Galen Hadley supported the bill. He said the goal of the commission would be to ensure that all Nebraskans are treated equitably under the tax code.

“It is very clear to us that people would like us to look at modernizing our tax system,” Hadley said. “We need to make sure we can look at this from a neutral standpoint.”

Omaha Sen. Heath Mello also supported the bill, saying it is the appropriate path forward.

“We need to take a step back and make a determination on how best to make changes instead of quickly pushing through radical changes,” he said.

In an effort to extend debate, Omaha Sen. Ernie Chambers brought several technical amendments that he said would improve a poorly worded bill.

After senators adopted several of the amendments, Schumacher moved to invoke cloture, or cease debate on the bill. Senators obliged on a 44-2 vote and advanced the bill to select file 47-1.