As we began the 2014 Legislative Session, I outlined in my State of the State address to the Legislature that Nebraskans deserve tax relief. I emphasized that I looked forward to working with the Legislature and our citizens to keep Nebraska moving forward.
Tax relief has been a top priority for Nebraskans and me. When this legislative session began, many didn't think that it was possible to achieve meaningful tax relief, but I believed we could. I stated numerous times that the goal was responsible and meaningful tax relief.
I didn't ask the Legislature to introduce a specific bill, because I knew that all of the tax bills that were needed for this discussion were already introduced at that point or would be introduced during the session. I was willing to work with the Legislature to achieve meaningful tax relief for our citizens.
That's why I am pleased to announce that Nebraska taxpayers will be receiving more than $412 million in tax relief over the next five years, which is responsible, meaningful and significant tax relief for hard-working families. Recently, I signed several bills into law that will provide the $412 million in tax relief and I will outline them here.
LB 987 will index Nebraska's individual income tax brackets for inflation. It will exempt social security income from taxation if you have an adjusted gross income of $58,000 or less for married persons filing jointly, and $43,000 or less for all others. This bill also provides tax relief for veterans. Now, veterans may make a one-time election, within two years of separation from military service, to not have their military retirement pay taxed. Veterans must elect to either exclude 40 percent of their pay from state taxation for seven consecutive years, or exclude 15 percent of their military retirement pay in perpetuity, starting at age 67.
LB 96 provides tax relief for farmers and ranchers. It eliminates sales taxes on repair parts for ag machinery and equipment.
LB 986 expands Nebraska's homestead exemption program so that more Nebraskans will qualify. I also signed into law LB 1087 that will expand eligibility for the homestead exemption to include honorably discharged 100 percent disabled veterans and their spouses and people with developmental disabilities.
Finally, LB 867 that includes a variety of sales tax reductions regarding a wide array of issues, from historic automobile museums to postage, as well as changes to the sports arena turnback provisions.
On the important topic of property tax relief, I signed into law LB 905 that increases the Property Tax Credit Program by $25 million on an annual basis. I wish it were more, but the Legislature did not approve an attempt to increase this amount.
In 2007, I worked with the Legislature to create the Property Tax Credit Program so that Nebraskans could have some form of direct property tax relief. We have worked hard to maintain this fund and keep property tax relief a priority for Nebraska citizens.
I want to thank our citizens for their dedication and commitment to their communities, our state and the United States of America. Our Nebraska values of personal responsibility, family, hard work and fiscal responsibility have kept Nebraska in better shape than the rest of the country.
We've learned how to compete in global markets. We've strengthened Nebraska's education system by focusing on academic excellence and academic improvement. We care about our children and their future. That's why the biggest and most important issue facing the State of Nebraska now and into the future is high taxes.
Tax relief is a major driving force for economic success. That's why I am pleased that we are able to conclude the 2014 Legislative Session with responsible, meaningful and significant tax relief of more than $412 million.
- Dave Heineman
Governor of Nebraska