If the Indiana legislature approves his plan to reduce income tax by 10 percent for Hoosiers, Gov. Mike Pence said the result of such an action should be posted on billboards and entrance signs across the state.
“Indiana would be the lowest-taxed state in the Midwest,” Pence said, as he added Indiana is already the fiscal envy of many of its neighboring states.
Among his stops in Floyd County Thursday, Pence spoke to the New Albany Rotary Club at the Culbertson West Mansion two months to the day after being sworn in as governor.
Labeled his jobs budget, Pence is proposing to increase private-sector employment by decreasing personal state income taxes by 10 percent. Though it would likely mean a savings of $200 annually for the average working family, Pence touted that the tax relief would put more than $500 million a year into the Hoosier economy.
With the state enjoying a surplus and in a strong financial position, Pence said the time is right to slash income tax collections.
“In Indianapolis we’re actually debating not whether to increase funding in our priorities, but by how much and where,” he said.
However, the Statehouse and many Republican leaders have yet to sign off on Pence’s plan. Despite a $2 billion surplus, some have questioned whether the state can afford what would amount to a $500 million annual reduction in collections if the income-tax cut is approved.
Pence has met opposition from fellow Republicans on his proposal, but has also picked up support from some Democrats.
The House-approved budget doesn’t include Pence’s tax reduction, and the Senate is in the process of deciding on the bill. The Senate Appropriations Committee is expected to review the House legislation over the next week to 10 days.
Sen. Ron Grooms, R-Jeffersonville, said it’s too early in the process for him to make a definitive decision on supporting Pence’s plan and the rest of the budget.
Financial forecasts expected to be received by mid-April will likely sway the vote, Grooms predicted. He said he’ll review the financial forecasts and the committee recommendations before making up his mind.
“I think the process is moving along, progress is being made, and there will probably be some type of compromise that will come out of this,” Grooms said.
Approving a budget is the primary job for legislators this year, and the issue will likely be debated up to the end of the session on May 1, Grooms continued.
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With a strong financial standing, commitments to infrastructure projects and a possible reduction of income taxes, Pence said Indiana is on the cusp of transforming from a “good to great” state.
“I like to say this is Indiana’s moment,” Pence said.
