House Bill 1002 (Various Tax Matters), authored by Rep. Tim Brown (R-Crawfordsville), was heard in the Senate Tax and Fiscal Policy Committee this week. It was amended but not yet voted on. Unfortunately, the amendment by committee chairman Sen. Travis Holdman stripped the bill and deleted the meaningful House Republican tax package proposal – including the phase out of the 30% minimum valuation depreciation floor for business equipment and machinery, elimination of the “double-direct” test applied to sales tax exemption of production inputs and the repeal of the utility receipts tax that adds to the energy bill of businesses. These are all important changes for which the Chamber has long advocated.
The amendment inserted in place of the significant House proposals contained: the provisions of SB 490 that put sunset dates on local innkeepers’ and food and beverage taxes across the state, and provisions to restrict the authority of the Indiana Gaming Commission. Given that the bill was not voted on suggests that Sen. Holdman may intend to further amend the bill and populate it with some of the Senate’s own ideas on what tax reform should look like.
The Senate leaders have not shown much love for the House proposals. And even though the state is experiencing unprecedented levels of tax revenues, they appear resistant to using even modest portions of a huge, and continually growing, revenue surplus to correct some bad tax policies that currently constrain economic growth.
The Chamber appreciates the Senate may have its own ideas about how to use tax revenues, but it is hard to ignore that Senate fiscal leaders seem to be abandoning proposals that have great merit and are willing to pass on what is a very rare opportunity to fix flaws in our tax structure. But we have faith in the process and believe there is a lot of discussion yet to take place, giving hope they will find some middle ground with their House colleagues. The fate of HB 1002 is likely to be determined by a conference committee, but what is on the table are issues that all in the Indiana General Assembly, the business community and the general public should be engaged in.
Call to action: As soon as possible, we encourage you to reach out to your Senator, especially if they sit on either the Appropriations or Tax and Fiscal Policy Committee. You can reach the senators at (317) 232-9400 or (800) 382-9467.
Resource: Bill Waltz at (317) 264-6887 or email: bwaltz@indianachamber.com
