Nebraska lawmakers propose a three-quarter sales tax increase to help provide property tax relief

The latest proposal to lower property taxes and lawmakers are proposing to increase sales tax across the board by three-quarters of a cent.

Also in the plan is to raise taxes on cigarettes, and previously exempted items like candy pop, and bottled water.

The extra money would result in about a 20% school property tax relief, but also provide about $500 million more to public schools.

Governor Ricketts says he doesn’t want to see any tax increased, and there’s a need to be more spending cuts.

“My agency is only going to grow at 2.3 percent and while we’re doing that we’re not only funding things like property tax relief fund, but also putting money in the budget for Medicaid expansion and increasing the school aid formula by over 10 percent. So again this is about making sure we are doing our job of running our services controlling our spending and by doing that prioritizing things in the budget we need to do like tax relief,” Gov. Pete Ricketts said.

“I understand where the governor is coming from. He’s trying to keep a lid on spending I get that I support his 3 percent lid, not everybody does but I don’t understand that, I’m with the governor on controlling spending but I don’t think we’re raising taxes, I think we’re cutting them and cutting them rather significantly,” Sen. Lou Ann Linehan the Revenue Committee Chairperson said.

The proposed three-quarter cent sales tax increase and the tax on cigarettes, candy, pop, and bottled water would go straight into the property tax credit fund and then to school aid.

Governor Ricketts is calling on Nebraska voters to take action.

“I’m not going to be in favor of raising anybody’s taxes and I encourage all Nebraskans to reach out to their state senators you can find them at Nebraska legislature.gov, just go there and contact your state senator and say don’t raise my taxes,” Ricketts said.

 While this is just a proposal the revenue committee is hopeful they will get all of the necessary votes to get something passed this legislative session.

“It’s still hard to get to 33, I understand it’s hard to get to 33, but I think we’ve got a very good package here at least the outlines of a very good package,” Linehan said.

Next week the revenue committee will be having a hearing on this bill.