State's tax season needs some work

Monday, June 2, 2003

Sometimes, we -- the voting and taxpaying citizens of this state and nation -- make the mistake of thinking that elected leaders are egotistical and unfeeling, entirely motivated by politics and self-promotion.

Sure, there are elements of that, otherwise the long-standing stereotype of the glad-handing, pork barrel politician would not be so prevalent.

But -- when you really get down in the trenches with elected leaders -- as Southwest Nebraskans did this year in defense of the Work Ethic Camp, you find that the lawmakers and administrative officials are just like we are, except they shoulder the responsibility of decision-making which affects hundreds of thousands of people.

The elected officials agonize about what's in the state's or nation's best interest, just as parents do when they decide whether or not to buy their teenager a car, or help to finance their son's or daughter's college education.

These thoughts come to mind because of the tough choices faced by state senators during the state's most serious financial crisis since the Depression.

So what do you do? Cut state expenses across the board by 10 percent, as suggested by Gov. Mike Johanns, or come up with a combination of spending cuts and tax increases, as the Nebraska Legislature finally voted to do?

As you and other Nebraskans know by now, the lawmakers overrode the governor's veto, thereby attempting to to fix the state's fiscal problems by making more than $400 million in spending cuts and extending more than $350 million in taxes.

"It's difficult. It bothers me to have to add to the heavy tax burden that Nebraskans are carrying," said State Sen. Tom Baker of Trenton. But, in the end, Sen. Baker saw little alternative, saying that severe cuts would have been crippling for Nebraska's educational system.

The budget-balancing debate was particularly difficult for Baker, who is a close personal friend of the governor, who fought hard and long for across-the-board cuts. It helped Baker to decide that the bulk of the taxes were not new; they were extensions of the sales tax rate of 5.5 percent and the income tax hike of 2.2 percent which had previously been enacted, but were scheduled to expire.

But the added tax bite still hurts, and the search continues for solutions. In telephone conversations with the Gazette Thursday afternoon, both Sen. Baker and Lt. Gov. Dave Heineman said the state has much work yet to do on funding and taxation issues.

Before the legislative session ended this week, Sen. Baker and other committee chairs in the legislature agreed to launch an interim study to restructure state and local government financing.

Sound revolutionary? It very well could be, but as tax crusaders have been preaching for years, Nebraska's system of taxation has some serious shortcomings.

The 2003 session could get us by for a while, but it also should shock citizens and the state's leaders into the reality that a major overhaul of the state tax system is needed.

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