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Indiana House Republicans aren’t giving up yet on a tax cut

Indiana House Republicans aren’t giving up yet on a tax cut.

The House passed a bill with four tax cuts totaling one-point-four-billion dollars. This week, a Senate committee got rid of all of them. Senate Republicans have said repeatedly the time to talk taxes is next year, when legislators write a new budget.

But Senate President Pro Tem Rod Bray (R-Martinsville) acknowledges the House is “pushing hard” for tax relief this year, and says negotiations are continuing. House Speaker Todd Huston (R-Fishers) says he still expects something to pass before legislators adjourn next month.

Huston argues with the state’s reserves expected to hit five-billion dollars this year, the state should be giving some of that money back to taxpayers. The House bill would slash Indiana’s income tax rate to three-percent, reduce taxes on business equipment, repeal two taxes on utility bills, and make it easier to trigger Indiana’s automatic tax rebate law.

Senate Tax and Fiscal Policy Chairman Travis Holdman (R-Markle) has warned Senate Republicans are “entrenched” in opposing anything that reduces money for cities and counties, or undermines the state’s commitment to paying down debt. That opposition would threaten plans to reduce the business personal property tax, which flows to local governments. It also affects the changes to the automatic rebate. The House plan removes a provision which would steer two-point-six-billion dollars to Indiana’s unfunded pension liability before calculating the rebate.

Huston isn’t saying whether there’s a minimum amount of tax relief he’d accept. “I’m not going to get into negotiating against myself,” he said.

Both the House and Senate point to rising inflation to support their positions on tax cuts. Huston says Hoosiers need more money in their pocket more than ever. Senate Republicans say they’re concerned rising prices will undermine the economy.

Four Democrats joined all but one Republican in approving the tax cut plan in the House last month.

A one-time tax rebate for 440-thousand Hoosiers is already on its way to Governor Holcomb. With only one dissenting vote, the House and Senate voted to extend the automatic tax refund to Hoosiers who didn’t owe any income tax.

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