The moves, disclosed by a senior Treasury official not authorized to speak publicly, represent the agency’s most aggressive strategy to dig out from under the massive backlog, the result of lagging operations due to the coronavirus pandemic.
The plan would cut the income tax rate to 3.15% from 3.23% for 2023, which would amount to a $40 savings for those with $50,000 in taxable income. The tax rate would be cut further in 2025, 2027 and 2029, but only if state tax revenue grows by at least 2% in the previous budget year.
The tax cut package was a major remaining issue as the Republican-dominated Legislature looked to possibly finish this year’s session on Tuesday.
The leader of the tax-writing House Ways and Means Committee said Monday that talks with senators included possibly linking tax rate cuts to whether state tax collections remain strong.
The Indiana House and Senate have both approved a measure that would reduce the tax on disposable e-cigarettes from 25% of the wholesale price to 15%.
Indiana Gov. Eric Holcomb, in an opinion piece distributed to media outlets on Thursday, solidified his support for legislation that would provide state tax cuts—and went a step further by asking for an even deeper reduction in income taxes than proposed by House Republicans.
Indiana Gov. Eric Holcomb said Wednesday he now believes the state’s individual income tax rate could be cut while maintaining enough state revenue for additional spending needs in the next state budget to be adopted in 2023.
The Senate’s tax committee voted 12-1 to advance the bill to the full Senate, where Republican leaders have cited uncertainty about the economy in resisting tax cuts despite recent big growth in state tax collections.
Indiana House members joined the Senate in approving a bill allowing about 450,000 people who don’t have enough income to owe any state taxes to also be eligible for the $125 refund payments.
The early deliberations come days after a group of vulnerable Senate Democrats introduced a bill that would suspend the gas tax of roughly 18 cents per gallon for the rest of the year.
Republicans who control the Michigan Senate on Tuesday passed a $2.5 billion annual tax cut, voting to lower income and corporate rates while letting people claim a credit for their children and deduct more retirement income.
Republicans in the Indiana Senate gutted House Republicans’ plan for $1 billion in tax cuts within minutes of the bill’s first hearing in the Tax and Fiscal Policy Committee on Tuesday.
Workers without children could also get additional help this tax season if they file. The relief package nearly tripled the earned income tax credit for workers without dependent children, meaning that 17 million people could receive credits worth $1,500.
U.S. Trade Representative Katherine Tai said the agreement with Japan, along with a separate deal last year on steel with the European Union, will put them in a better place to compete against China, the world’s second largest economy.
Residential homeowners in Indiana already pay 45.6% of the property tax burden and that would rise to 51% by 2026 even without a legislative proposal to reduce the business personal property tax, according to a study commissioned by the Association of Indiana Counties.
Indiana Senate Republicans are not moving forward with their own tax cut proposals aimed at reducing business personal property taxes and offering a temporary sales tax holiday, casting doubt on a key provision in the House Republicans’ $1 billion tax-cut plan.
An IRS worker shortage and an enormous workload from administering pandemic-related programs will combine to cause taxpayers pain this filing season.
The Indiana Department of Revenue encourages taxpayers to use electronic filing, online payment and direct deposit to significantly improve the quality and speed of processing returns and refunds.
Republicans in the Indiana House passed their $1 billion individual income and business tax-cut proposal Thursday on a 68-25 party-line vote, sending it to the Senate, where its future is murky.
While the push for broad tax cuts has been coming primarily from Indiana House Republicans so far this legislative session, some Senate Republicans are offering more modest alternatives exclusively aimed at reducing the personal property tax businesses pay on equipment.
