Bill to expand tax review report advances

Lawmakers advanced a bill from general file March 6 that would add categories to the annual tax review report produced by the state Department of Revenue.

Sen. Rich Pahls of Boys Town, sponsor of LB962, said the department currently produces a review of major tax exemptions for which state general funds are used to reduce the impact of lost revenue. Under the bill, information in the report would be broken down into specific categories in relation to sales and use tax.

As introduced, the bill also would name the legislative Tax Rate Review Committee and change its composition. Currently, the un-named committee includes the speaker of the Legislature and the chairpersons of the Appropriations, Revenue and Executive committees.

A Revenue Committee amendment, adopted 35-0, removed a provision from the bill that would have added the state tax commissioner as the fifth voting member of the committee.

Bellevue Sen. Abbie Cornett, chairperson of the Revenue Committee, said adding a member of the executive branch to the legislative committee would raise concerns regarding the separation of powers.

“He or she cannot be a member of the committee without raising questions about the constitutionality of the bill,” she said.

LB962 also would require that the Tax Rate Review Committee’s report be appended to the Department of Revenue’s tax expenditure report.

Pahls said consolidating the information would improve senators’ understanding of the state’s revenue picture.

“We already have two pieces of information coming to us,” he said. “I want to combine them so that when we look at them we have the total picture.”

The bill advanced to select file on a 34-0 vote.