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Legislators Still Unsure About Pence’s 10 Percent Tax Cut

Pence included the tax cut in his budget proposal Tuesday, but legislators say they still do not know if they will support it.

Department of Revenue

Photo: Dan Goldblatt/WFIU-WTIU News

The governor wants to cut income tax on all Hoosiers by 10 percent.

State lawmakers got their first look at Governor Mike Pence’s complete budget proposal Tuesday, including Pence’s 10 percent income tax cut. Legislators say it is still too early to determine whether the cut will become a reality.

Pence’s proposed budget keeps government spending increases fairly low, both in comparison to the last several state budgets and to inflation growth. That would allow the state to cut personal income taxes ten percent across the board while maintaining a rainy day fund.

Noblesville Republican Senator Luke Kenley says if the state has enough money to reduce taxes, cutting the personal income tax rate might not be the best choice.

“Some would argue that if you lower the corporate income tax a little more, closer to where the individual income tax is, you’ll draw more businesses and more jobs in Indiana,” he says.

Pence’s budget director Chris Atkins says the personal income tax cut can be an economic driver.

“Well most importantly it would permanently lower taxes on most Indiana small businesses and employers and it would put $500 million directly back into our economy by letting Hoosiers keep more of their own money,” Atkins says.

Kenley says Pence’s proposed budget is a good baseline legislators can use to jumpstart discussion of the tax cut’s feasibility

Brandon Smith, IPBS

Brandon Smith, IPBS has previously worked as a reporter and anchor for KBIA Radio in Columbia, MO, and at WSPY Radio in Plano, IL as a show host, reporter, producer and anchor. Brandon graduated from the University of Missouri-Columbia with a Bachelor of Journalism in 2010, with minors in political science and history. He was born and raised in Chicago.

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  • http://www.facebook.com/people/Pat-McGroin/100003643105942 Pat McGroin

    Or we could cut the sales tax rate, which would help everyone.

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