Straight Talk From Steve
Consumption Tax Hearing
February 2, 2022 | View PDF
The public hearing for my priority bill has been set at the Nebraska State Capitol in Lincoln for Thursday, February 3, 2022 beginning at 1:30 p.m. The public is invited to attend the hearing and to testify in person. LR 264 CA is my priority bill. LR 264 CA is a resolution for a constitutional amendment for the consumption tax. Before the consumption tax can ever become law in Nebraska, the voters must vote to amend the Nebraska State Constitution.
LR 264 CA contains the ballot language that would be put on the ballot for the election to be held on November 8 later this year. That ballot language would read as follows: “Beginning January 1, 2024 no taxes other than retail consumption taxes and excise taxes shall be imposed on the people of Nebraska.”
The consumption tax is needed in Nebraska because our current tax system is broken. Nebraska’s tax system is beyond the point of repair. Nebraskans no longer have time for slow, incremental repairs to their tax system. The ship is sinking fast, and no number of buckets can curtail the amount of water flowing aboard. Instead, the time has come to abandon ship and build a new and better one.
That is what the consumption tax will do for Nebraska. Last week Daniel J. Pilla, who is a tax litigation expert and founder of the Tax Freedom Institute delivered a series of lectures on tax reform across the State of Nebraska. Pilla wrote the book on tax policy. According to Pilla the only kind of tax system which can survive his rigid test of ten tax principles is a broad-based sales tax, otherwise known as the consumption tax.
In short order form, Daniel J. Pilla’s ten tax principles can be summarized as 1) Simplicity: The tax code should be simple to understand, 2) Noninvasiveness: The Tax code should encourage voluntary compliance, 3) Efficiency: The fewer taxes, the better, 4) Stability: The tax code should provide reliable revenues for the State, 5) Visibility: Government spending should be transparent, 6) Neutrality: Taxes should not favor one industry or class of people over another, 7) Economic Growth: The tax code should encourage investing and consumer spending, 8) Broad-Based: Everyone should make a contribution, 9) Equality: Everyone should be treated equally and fairly, and 10) Constitutionality: Tax revenues should only be used for clearly defined constitutional functions.
The consumption tax not only complies with each of these ten tax principles, but it also has the potential to make Nebraska the most tax friendly state in the Union. Instead of losing populations, resources, and revenues to other states, people will want to move themselves and their businesses to Nebraska. The time has come to blow up our current tax system and start over with a whole new tax system which works. So, today I am inviting you to join my effort by submitting comments for the public record and asking the members of the Legislature’s Revenue Committee to advance LR 264 CA out of committee. The deadline to submit comments for the public record is February 2, 2022 at 11:00 a.m.
The procedure for submitting online comments to resolutions and bills for the record has changed this year. To submit a comment online, go to the Legislature’s webpage at http://www.nebraskalegislature.gov. In the “Search Current Bills” box enter LR 264 CA to get the webpage for the resolution. Then, click on the “Submit Comments” box. Complete the information asked for and post any comments in the comments box. Just tell the committee members why you want the consumption tax. Afterwards, you will receive an email asking for you to confirm your submission. Be sure to respond to that email. Unless you respond to the confirmation notice, your comments won’t be submitted for the public record. Let’s show the Revenue Committee how much Nebraskans want this kind of tax reform.