Law­mak­ers con­sid­er­ing pos­si­ble tax credit cuts

Post-Tribune - - Post-Tribune State - THE AS­SO­CI­ATED PRESS

IN­DI­ANAPO­LIS — In­di­ana law­mak­ers are about to con­sider a pro­posal to elim­i­nate sev­eral tax de­duc­tions and cred­its, on the urg­ing of Repub­li­can Gov. Mike Pence.

One bill sched­uled for a House Ways and Means Com­mit­tee hear­ing on Wed­nes­day pro­poses end­ing 29 in­come tax breaks to help pay for tax changes that would ben­e­fit busi­nesses.

The pro­posal, spon­sored by Rep. Todd Hus­ton, R-Fish­ers, would elim­i­nate cred­its that cost the state about $21 mil­lion a year, The Jour­nal Gazette re­ported.

“The goal is to sim­plify taxes and keep it rev­enue neu­tral,” Hus­ton said. “We want to honor that com­mit­ment and stream­line ef­fi­ciency.”

The largest of the de­duc­tions tar­geted for elim­i­na­tion is the In­di­ana col­lege con­tri­bu­tion credit, which al­lows up to a $200 credit to joint tax re­turn fil­ers for con­tri­bu­tions to state uni­ver­si­ties or col­leges.

A re­cent In­di­ana In­come Tax Study found that some 87,000 in­di­vid­u­als claimed the credit in 2011. Elim­i­nat­ing the credit would save the state about $8.7 mil­lion a year, ac­cord­ing to the non­par­ti­san Leg­isla­tive Ser­vices Agency.

“I per­son­ally uti­lize that tax credit for both Pur­due and IU ev­ery year,” Repub­li­can House Speaker Brian Bosma said. “I think it’s a pos­i­tive item. I’d have to think long and hard about the elim­i­na­tion of that.”

Hus­ton said that col­lege tax credit will gain the most at­ten­tion and “we’ll have an hon­est dis­cus­sion” about whether it pro­vides the state with an $8 mil­lion eco­nomic ben­e­fit.

The bill would not af­fect the much more popular tax credit for col­lege sav­ings plans.

Hus­ton’s pro­posal would also broaden an ex­emp­tion from the state’s 7 per­cent sales tax on equip­ment pur­chases by man­u­fac­tur­ers.

Chris Atkins, direc­tor of the gover­nor’s Of­fice of Man­age­ment and Bud­get, said the state Depart­ment of Rev­enue spends much time work­ing with busi­nesses on whether they must now pay the sales tax be­cause the cur­rent ex­emp­tion stan­dard is to ad­min­is­ter.

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.