Nebraska lawmakers are debating a bill that would lower the state’s top income tax rates. Senator Lou Ann Linehan’s legislation would lower Nebraska’s top individual income tax rate from 6.84% to 5.84% by 2025.
“We are simply not competitive with surrounding states when it comes to our taxes,” Linehan says. “South Dakota and Wyoming have no income taxes. Colorado, Kansas and Missouri have lower rates than we do.”
Her bill would also drop the top corporate tax rate from 7.25% to 5.84% by 2026. The relief would be available to Nebraskans with a taxable income of $32,210 a year or families with a taxable income of $64,430 a year.
Supporters of the bill say many middle-income residents earn far more than those amounts and thus pay some of their taxes at the highest rate, but Senator Megan Hunt says the rich would also benefit. “It is not time to decrease taxes on top earners in Nebraska. It’s time to add more tax brackets in Nebraska and increase taxes on people with an income of more than a million dollars.”