Governor's Tax Plan Would Create High Costs For Agriculture

Farm Bureau warns eliminating state income tax would have to be offset by removing sales tax exemptions.

Published on: Feb 5, 2013

The Nebraska Farm Bureau says Gov. Dave Heineman's proposed tax package in this session of the Unicameral would come down hard on the state's agriculture.

"While we share an interest in job creation and growing Nebraska's economy, we do not believe you can have a comprehensive tax reform conversation without including property taxes," says Steve Nelson, Nebraska Farm Bureau president from Axtell. "For farm and ranch families and many Nebraskans, property taxes must be included in the discussion. My property taxes have increased significantly in recent years and the focus should be on reducing property taxes on Nebraska families.

"The governor's plan will mean a huge tax increase on farm and ranch families," Nelson says.

Steve Nelson, Nebraska Farm Bureau president
Steve Nelson, Nebraska Farm Bureau president

The governor's plan calls for eliminating state income tax on individual and corporations and replacing that tax revenue by eliminating millions of dollars' worth of sales tax exemptions. Ag interests contend removing sales tax exemptions on many items, including, equipment, seed and chemicals, would impose millions of dollars of taxes on farmers and ranchers.

Nelson says that Nebraska and its citizens have weathered the nation's economic troubles better than the rest of the country due to the strength of agriculture, our state's number one industry. "It is difficult to see how raising taxes on families involved in farming and ranching can help grow the state's economy," he adds.

Nebraska farmers and ranchers face the prospect of a second year of drought and higher input costs, according to Nelson. "Agriculture is a cyclical business, and decisions about agriculture's treatment in our state's tax policy should be based on historical performance and not simply a few good years.

"If this conversation is truly about job creation, agriculture and associated businesses are a primary job creator in our state, accounting for one out of every four jobs," he says. "Tax policy that harms agriculture will cost the state jobs and will not be good for Nebraska."