Amendments to property tax plan proposed

The Revenue Committee heard testimony Aug. 7 on two potential additions to their anticipated property tax relief proposal.

LB9, introduced by Sen. Jana Hughes of Seward, is intended to reduce property taxes by decreasing the maximum school general fund levy and directing more state funding to public schools. The bill is expected to be the vehicle for the committee’s forthcoming tax relief proposal along with other measures considered during the special session.

The first amendment would add alternative nicotine products — noncombustible products containing nicotine that can be chewed, absorbed, dissolved or ingested — to the definition of tobacco products, which includes cigars, snuff and electronic nicotine devices.

Elkhorn Sen. Lou Ann Linehan, the committee’s chairperson, said alternative nicotine products, including oral nicotine pouches, would be taxed at 10 cents per ounce under the amendment.

Hughes provided neutral testimony, saying she had intended to introduce a similar proposal in the next regular legislative session. She said oral nicotine pouches are a more discreet way to consume nicotine than vaping or chewing tobacco, making them popular with minors.

Hughes suggested taxing alternative nicotine products at 20% of their wholesale price, as other tobacco products are, because a per-ounce tax would generate less revenue if the price of the pouches increases.

The second amendment would exempt the sale and purchase of electricity for residential use from state sales and use taxes, which Linehan said would end state taxation of a necessity and benefit both homeowners and renters.

Jill Becker testified in opposition to the amendment on behalf of Black Hills Energy. She said 59% of Nebraska households use natural gas for heating and that the exemption would provide a greater benefit to utility customers who use only electricity.

The committee took no immediate action on the proposals.