INDIANAPOLIS — Despite a months-long study of Indiana’s tax structure, state fiscal leaders say they don’t anticipate much tax reform next year.
During the Dentons Legislative Conference in downtown Indianapolis this week, lawmakers on the State Budget Committee and the State and Local Tax (SALT) Task Force agreed Indiana’s financial health is in good shape and is only one percent (roughly $115 million) behind forecasted revenues.
However, with fears of a recession looming, lawmakers said they need more time to review the state’s tax structure before making any major changes to it.
”We need to do a much greater analysis,” State Sen. David Niezgodski of South Bend said.
State Sen. Travis Holdman, who chairs the SALT Task Force, said Indiana went down from 9th to 10th place nationwide in terms of tax climate according to the Tax Foundation, and that while the task force is moving in the right direction, a final report will not be complete until 2025.
“Other states will pass us by if we don’t have a holistic approach to taxation in the state,” Holdman said. ”I think there are some fixes that we need to talk about, and controlling spending will be, at the local level, major on that list from a property tax standpoint.”
State Rep. Greg Porter, a voting member of the State Budget Committee, also said he hopes property tax reform will be front and center next session.
”The cost of the property taxes and what we did quote-unquote last session—how we can potentially build on that to really add some real sustainable tax relief for working men and women,” Porter said.
But some lawmakers urged caution for other kinds of tax cuts. Rep. Porter said since 2013, Indiana’s cuts to corporate and income taxes resulted in several billion fewer dollars for the state.
”If we continue to look at cutting more taxes, what is the real spiral that’s going to occur within the state?” Porter asked.
The State Budget Committee will receive an update on Indiana’s economic outlook on Dec. 19. The SALT Task Force will open the floor for public comment at its next meeting on Jan. 10.
