{"id":32334,"date":"2022-04-06T10:31:06","date_gmt":"2022-04-06T16:31:06","guid":{"rendered":"http:\/\/update.legislature.ne.gov\/?p=32334"},"modified":"2022-04-06T10:31:06","modified_gmt":"2022-04-06T16:31:06","slug":"consumption-tax-proposal-fails-on-first-round","status":"publish","type":"post","link":"https:\/\/update.legislature.ne.gov\/?p=32334","title":{"rendered":"Consumption tax proposal fails on first round"},"content":{"rendered":"

A proposed constitutional amendment that would replace Nebraska\u2019s tax system with retail consumption and excise taxes failed to advance from general file April 5.<\/p>\n

\"Sen.
Sen. Steve Erdman<\/figcaption><\/figure>\n

If passed by the Legislature, LR264CA, introduced by Sen. Steve Erdman of Bayard, would place the question on the November 2022 general election ballot. The change would go into effect Jan. 1, 2024, if approved by voters.<\/p>\n

Legislative efforts in recent years have failed to yield significant tax relief, Erdman said, and Nebraska\u2019s tax system drives away workers, businesses and retirees.<\/p>\n

He said replacing property, income, sales and inheritance taxes with a flat consumption tax \u2014 with a rate of approximately 9 percent \u2014 would increase economic growth by attracting residents and creating jobs.<\/p>\n

Elmwood Sen. Robert Clements supported the proposal, saying a simple tax system with a single rate would be best.<\/p>\n

\u201cWe\u2019ve tried and tried to put some reins on local property tax increases, and this would help control the overtaxing and overspending of some entities,\u201d he said. \u201cI think it\u2019s time to let the voters decide and let us know how they would like to be taxed.\u201d<\/p>\n

Sen. Steve Halloran of Hastings also supported LR264CA, saying the state\u2019s current tax system is flawed. He said lawmakers would create a \u201cnuts and bolts\u201d bill to implement the proposal in the next legislative session if voters approve it.<\/p>\n

\u201cWe need to give the second house a chance to decide the tax model that\u2019s best for them,\u201d Halloran said, \u201cand we\u2019ll work out the details.\u201d<\/p>\n

North Platte Sen. Mike Jacobson said he was intrigued by the proposal. He said implementing a consumption tax through legislation, however, rather than a constitutional amendment, would allow lawmakers to change the new system more easily.<\/p>\n

Jacobson also raised several questions about how the proposal would be implemented. He questioned, for example, whether the state would assume responsibility for paying off bonds issued by local political subdivisions that could no longer levy their own taxes.<\/p>\n

\u201c[LR264CA] sounds very good, but it\u2019s the details that we\u2019re going to need to work on,\u201d Jacobson said. \u201cI think we\u2019re premature on pushing this out to the voters without having those answers.\u201d<\/p>\n

Additionally, he said, the consumption tax rate likely would have to be much higher than 9 percent to raise the same amount of revenue as the current system.<\/p>\n

Sen. Tom Brandt of Plymouth said he was concerned that, by approving the proposal, voters would cede control of local political subdivisions, including school districts, to a central state authority.<\/p>\n

That authority would have to approve local funding requests and could decide to consolidate smaller school districts, he said.<\/p>\n

LR264CA failed to advance to select file on a vote of 19-14. Twenty-five votes were needed.<\/p>\n","protected":false},"excerpt":{"rendered":"

A proposed constitutional amendment that would replace Nebraska\u2019s tax system with retail consumption and excise taxes failed to advance from general file April 5. <\/p>\n","protected":false},"author":1,"featured_media":32320,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"colormag_page_container_layout":"default_layout","colormag_page_sidebar_layout":"default_layout","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[17],"tags":[192],"class_list":["post-32334","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-revenue","tag-sen-steve-erdman"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/update.legislature.ne.gov\/wp-content\/uploads\/2022\/04\/LR264Erdman4-5-22a.jpg","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/update.legislature.ne.gov\/index.php?rest_route=\/wp\/v2\/posts\/32334","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/update.legislature.ne.gov\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/update.legislature.ne.gov\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/update.legislature.ne.gov\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/update.legislature.ne.gov\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=32334"}],"version-history":[{"count":3,"href":"https:\/\/update.legislature.ne.gov\/index.php?rest_route=\/wp\/v2\/posts\/32334\/revisions"}],"predecessor-version":[{"id":32336,"href":"https:\/\/update.legislature.ne.gov\/index.php?rest_route=\/wp\/v2\/posts\/32334\/revisions\/32336"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/update.legislature.ne.gov\/index.php?rest_route=\/wp\/v2\/media\/32320"}],"wp:attachment":[{"href":"https:\/\/update.legislature.ne.gov\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=32334"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/update.legislature.ne.gov\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=32334"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/update.legislature.ne.gov\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=32334"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}