Those who gathered Monday night for an anti-tax rally expressed more puzzlement than outrage.
Three present and former Lake County officials attempted to answer questions about whether a proposed 1.5 percent county income tax will be imposed on Social Security benefits, why the county would collect an income tax and give it back to the public as property tax relief and whether it was a redistribution-of-wealth scheme.
Commissioner Gerry Scheub, D-Crown Point, Councilwoman Christine Cid, D-East Chicago, and former county Councilman Larry Blanchard attempted some explanations, although they warned some important details have yet to be worked out.
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The Lake County Council passed several ordinances by a 4-3 vote April 9 to create three separate taxes amounting to 1.5 percent to be imposed on the income of all county residents and out-of-state residents, who earn income from work performed within the county.
That includes a 1 percent income tax to be given back as property tax relief, a .25 percent tax to build public safety agency budgets and a .25 percent economic development tax that can be earmarked for roads, bridges and other infrastructure.
Property tax reductions funded by an income tax will vary from 7 percent to 27 percent depending on the taxpayer's home community.
Although county government will reduce its tax rate by the same amount — 45 cents on every $100 of assessed real estate value — across the county, the dollars subtracted from each bill differ. Property tax relief will be greater in small communities and rural areas than it is in large cities where other local government agencies demand their share of the total tax levy.
Robert Dittmer, director of public relations for the Indiana Department of Revenue, which oversee county tax collection, said last week a local income tax wouldn't be imposed on Social Security benefits, but it will on most pension income.
Blanchard said the county tax will be imposed on the same income state tax already is on. Lake is the only county in the state without a local income tax.
If the council passes the tax on second reading May 6, it moves to the three-member Board of Commissioners, where Scheub said he will veto the tax.
If Scheub's veto is joined by that of a second commissioner, the tax would die, unless the seven-member council musters five votes to override the veto.
