By Ed Feigenbaum in the Indianapolis Business Journal:
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On the session’s final Wednesday night, Gov. Pence agreed to accept a legislatively crafted budget featuring a conglomeration of tax cuts, including a pared-down and phased-in version of his signature proposal: a 10-percent individual income tax rate cut.The final budget deal only slightly trims the individual income tax rate in 2015 and again in 2017. The tax-cut bundle also continues corporate income tax rate reductions, eliminates (instead of phasing out) the inheritance tax, and reduces the financial institutions tax.
The latter two items—neither sought nor advocated by the governor—will mean some $170 million less in revenue annually flowing to the state.
Outside of the budget, new tax deductions for the 13 casinos and racinos and lower tax rates for some of the smaller-grossing casinos will also decrease state revenue.
However, a provision in the budget bill related to racino slot wagering taxes will likely result in the settlement of a problematic tax case and an infusion of cash to state coffers now held in escrow. That should cancel out about half of the first year’s forgone inheritance tax and financial institutions taxes.
Pence praised the final tax package as a major win for Indiana, an assemblage of cuts he says will touch all Hoosiers and be even better for the state than his own proposal.
Democrats—who had sought all-or-nothing tax cuts so as to better position middle-class taxpayers—criticized the final form as all but meaningless to most taxpayers in the first two years of the cut, amounting to about enough cash in their pocket to pay for an extra can of soda every week. Spending the money on targeted programs or approving deeper cuts would have been more impactful, the Democrats said.
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See the full article here:
http://www.ibj.com/feigenbaum-statehouse-looks-to-pence-and-his-mighty-pen/PARAMS/article/41155
