Bill seeking to study elimination of state income tax advances
The Senate on Monday unanimously advanced Senate Bill 3, which seeks to form the State and Local Tax Review Commission to study the feasibility of ending Indiana’s income tax and reforming property taxes for Hoosiers.
Bill author Sen. Travis Holdman, R-Markle, previously emphasized that the House and Senate chambers already passed a plan to cut Indiana’s individual income tax rate from 3.23% to 2.9% by 2029.
He said Indiana’s long-term goal should be “to totally eliminate the individual income tax rates.” To do that, lawmakers need to look at the entire tax system “holistically, instead of trying to make piecemeal changes,” Holdman said.
Currently, seven states don’t have a state income tax.
Indiana lawmakers typically pay about $1 billion each year to the Pre-1996 Teachers’ Retirement Fund. Once the pension plan no longer has an unfunded liability, however, the state will have that money to work with in the state’s budget.
The estimated payoff date for the pension fund was beyond 2060 back in 2011. State lawmakers are now aiming to fund the pension plan by 2029.