Nebraska Governor wants to reduce property taxes by $2 billion

OMAHA, Neb. (WOWT) - Nebraska Gov. Jim Pillen says it’s a problem that is handcuffing Nebraskans: enormously high property taxes. He vows to cut those taxes by more than $2 billion, by taxing other things.

Nebraska taxes are divided into three main groups, and in 2024, the state expects $5.3 billion from local property taxes, $3.6 billion in state income taxes, and $2.5 billion in state sales taxes.

Gov. Pillen wants to get that $5.3 billion in property taxes down near the $3 billion mark — a 40 percent reduction.

But in order to do that, one of those other numbers would have to go up, and the most likely candidate according to policy experts, is sales tax.

Gov. Pillen spent half an hour explaining why he believes property taxes are too high in Nebraska, how local taxing bodies need more oversight, and that lawmakers and citizens need to come together to find solutions.

But the Governor also none of his own solutions — only that taxing groceries is off the table since they’re a necessity. Gov. Pillen says all the wants are in the sales tax crosshairs, plus, the thousands of items that are currently exempt from sales tax are getting a second look.

“From my seat, everything is on the table,” Gov. Pillen said. “Items that aren’t going to put business or agriculture or manufacturers at a disadvantage and items that are non-essential — there are a number of items that are. We’re looking at every sales tax exemption and trying to make sure no stone is unturned.

Open Sky Policy, a non-profit think tank in Nebraska, responded to the Governor’s remarks that needs won’t be taxed, but should be.

“It’s difficult for a Nebraskan who goes to work to get by without a car,” Open Sky Policy representatives said in a statement to 6 News. “And our young families, those so important to our state’s future, must account for the expenses of car seats, diapers, and clothes. All of those items are subject to sales taxes in Nebraska, for which low and middle-income residents pay a higher share of their income.”

Gov. Pillen said he’s been talking with stakeholders, along with the chamber, for months about reducing the property tax burden. He says he wants Nebraskans to open new ideas as this debate moves forward.

Those ideas will come in the form of priority bills from state lawmakers, the details of which are not yet revealed.

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