Baird: House GOP advances $1B tax-cut
Indiana House Republicans recently advanced a sweeping tax cut package that could put more than $1.3 billion back in Hoosiers’ pockets, according to State Rep. Beau Baird (R-Greencastle), who supported House Bill 1002.
The state’s budget reserves are expected to hit a record $5 billion at the end of fiscal year 2022. Baird, a member of the House Ways and Means Committee, said if House Bill 1002 becomes law it would be the largest tax cut in state history.
“Years of fiscal discipline continue to pay dividends for Hoosier taxpayers,” Baird said. “We prioritize paying down debt while investing in our future and maintaining responsible reserves. This puts us in a position to be able to cut taxes for those who ultimately make Indiana a great place to live, work and raise a family.”
Baird said the bill would deliver direct relief to working Hoosiers by phasing down Indiana’s individual income tax from 3.23 percent today to 3 percent by 2026.
If passed, Hoosiers would also pay less on their utility bills with the elimination of the 1.4 percent Utility Receipts Tax, which would take effect in July. Currently, individuals and businesses pay the Utility Receipts Tax on their monthly electric, natural gas, water, steam, sewage and telecommunications bills.
About 4.3 million Hoosier taxpayers are set to receive a $125 refund after they file their taxes in 2022 due to higher-than-expected state revenue numbers during the 2021 fiscal year. House Bill 1002 would help streamline this process and ensure about another 900,000 taxpayers also receive a refund.
Rep. Baird said the bill would also encourage new investments by lowering Indiana’s business personal property taxes while ensuring homeowners and schools aren’t negatively impacted by the reduction in revenue.
Specifically, the bill eliminates the 30 percent depreciation floor for newly purchased business personal property starting in January -- an issue opposed by many local governmental units, including the Greeencastle City Council -- and creates a state income tax credit to offset a portion of the personal property taxes paid on existing equipment. Under current law, businesses pay a tax based on a minimum of 30 percent of the original purchase price of their business personal property, regardless of the age or the true tax value of the equipment.
House Bill 1002 would also exempt more manufacturing and agricultural production inputs from the seven percent state sales tax to avoid sales tax pyramiding.
Baird said Indiana has paid down well over $1 billion in debt over the last year alone.
Visit iga.in.gov for more information on House Bill 1002, which now moves to the Indiana Senate for further consideration.