Gov. Dave Heineman today was joined by Grand Island Mayor Jay Vavricek to express opposition to LB 357, a bill that would increase sales taxes by up to 33 percent in 86 Nebraska cities.
"Hard-working, middle class Nebraskans deserve to have their taxes lowered, not increased," said Gov. Dave Heineman. "This tax increase would not only be on the working men and women of Grand Island, Omaha, Lincoln and 83 other cities, but every Nebraskan who shops in these cities. Even though Nebraska is economically stronger than most states, many Nebraska families struggle from paycheck to paycheck. This tax increase will hurt middle class families and it will be a step backwards."
"Expanding the ability to tax more is not the answer for cities," said Mayor Jay Vavricek. "Instead, the focus should be on the policies that drive expenses at the local level with more flexibility, less government mandates, greater local control to manage expenses, new growth and jobs. Because costs are increasing faster than tax revenue in every city, greater sales tax authority won't solve anything except a short-term budget cushion, only to be gobbled up within a few short years and that would delay future decisions that need to be made today."
This bill would increase the sales tax by one-half-of-a-cent on working men and women in the City of Omaha and potentially other Nebraska cities. An increase in the sales tax will make the State of Nebraska less competitive for jobs and potentially hurt Nebraska's Tax Foundation ranking because state and local sales taxes are part of that calculation.
Since Gov. Heineman took office, Nebraska's Tax Foundation ranking has improved from 45th to 30th, however the Governor noted that there was still work to be done and Nebraskans deserve to keep more of their hard-earned wages.
Additionally, Gov. Heineman pointed out that while some city representatives say they want to give citizens the choice to raise the sales tax, those same city representatives are not offering a choice for citizens to vote on having the sales tax or their property taxes reduces. Cities could reduce property taxes by reducing spending. Over the past several years, state government has reduced spending, balanced its budget and provided tax relief to Nebraskans.
"Unless the Legislature reverses course, the legacy of this session will be one in which illegals were given preferential treatment over legal Nebraska citizens. This will be a session remembered for a tax increase on legal working Nebraska men and women while illegal aliens were provided taxpayer-funded benefits."