STATEHOUSE (Jan. 25, 2022) – Indiana House Republicans recently advanced a responsible and sweeping tax cut package that could put over $1.3 billion back in Hoosiers' pockets, according to State Reps. Alan Morrison (R-Brazil) and Beau Baird (R-Greencastle), supporters of House Bill 1002.
The state's budget reserves are expected to hit a record $5 billion at the end of fiscal year 2022. Morrison said if House Bill 1002 becomes law, it would be the largest tax cut in state history.
"Returning more money to the people who earned it is the right thing to do, especially as we face a record budget surplus," Morrison said. "Hoosiers know their own needs best, and cutting taxes can help more families afford to pay for them."
Baird said the bill would deliver direct relief to working Hoosiers by phasing down Indiana’s individual income tax from 3.23% today to 3% by 2026. If passed, Hoosiers would also pay less on their utility bills with the elimination of the 1.4% 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.
"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."
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% depreciation floor for newly purchased business personal property starting in January 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% 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 7% state sales tax to avoid sales tax pyramiding.
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.
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State Rep. Alan Morrison (R-Brazil) represents House District 42,
which includes all of Vermillion County and portions of Clay, Fountain, Parke, Vigo and Warren counties.
Click here to download a high-resolution photo.
State Rep. Beau Baird (R-Greencastle) represents House District 44,
which includes all of Putnam County and portions of Clay, Morgan, Owen and Parke counties.
Click here to download a high-resolution photo.
