"The Official Portrait of Miss InDiana"

"The Official Portrait of Miss InDiana"
aka "Miss Victory"

Monday, October 22, 2007

Senator Hume (Princeton IN) calls for constitutional amendment to eliminate Homestead property taxes -- Senator Richard Young endorses plan

We received this press release from Senator Hume's office today. -- The editors

INDIANAPOLIS – A proposal released today by State Senator Lindel Hume (D-Princeton) would provide property tax relief for Indiana residents through a complete elimination of the Homestead tax. A long time proponent of property tax reduction, Hume said a constitutional amendment to eliminate Homestead property taxes would be a more responsible approach to providing permanent relief for homeowners than a total repeal of taxes for all property classes.

“Unlike many of the other proposals being discussed, my plan directs one hundred percent of the tax relief to our homeowners and renters,” Hume said. “If all property taxes were eliminated, more than half of the relief would benefit businesses at the cost of Indiana workers.”

According to Hume’s plan, the state would pay the property tax levy on homeowners’ behalf for all properties that qualify as Homesteads under current state law, which includes primary residential properties occupied by the homeowner. Additionally, renters would see increased tax relief through a new income tax credit.

“The goal is to provide direct, permanent and complete property tax relief for homeowners,” Hume said. “Through minimal tax shifts we can also significantly reduce the tax burden for family farms while continuing Indiana’s hospitable tax environment for business.”

Senate Minority Leader Richard Young (D-Milltown), also an advocate for property tax reduction, endorses the plan and said he believes it will provide an immediate solution for Hoosier homeowners. “We could solve the dilemma for homeowners now, not wait until next year,” Young said. “There are a lot of ideas for reform being discussed. This legislation could be enacted in November and be in place in 2008 while further solutions are debated.”

Hume said the plan’s focus on Homestead property taxes intentionally provides an opportunity to be used in concert with other initiatives, including further action in assessment and local government reform. “We have two state commissions working on recommendations for improving Indiana’s tax system and local government structure. This plan would advocate for Hoosier homeowners while allowing other necessary reform to take place,” Hume commented.
Hume is a special advisor for the Commission on State Tax and Financing Policy and serves on the Senate Appropriations Committee and State Budget Committee.

Other components of Senator Hume's Plan:

Replacement Revenue
Homestead property taxes provide approximately $2.2 billion in revenue to local governments in 2007, with estimates growing to more than $2.9 billion over then next three years. A combination of income and sales tax increases would be used to raise the revenue necessary to replace the lost funding from Homestead property taxes for local units.

Indiana’s income tax rate would increase by 1.6 percent to 5.0 percent. This increase is expected to create approximately $2.1 billion in new revenue in the first year.
Indiana’s sales tax rate would increase by 1 percent to 7 percent. This increase is expected to create approximately $812 million in new revenue in the first year.

Relief for Renters
By converting the state’s renter’s income tax deduction to an income tax credit of 8 percent of rent paid during the tax year, tax relief would roughly quadruple for renters. The credit is designed to refund a portion of rent that is based on the property tax.

Local Government Flexibility
School and other local unit revenue would be unaffected as would local tax incremental funding (TIF) districts and abatements. Local governments would still have the ability and responsibility to manage local government spending, including school construction costs. Local officials would also still have the opportunity to provide property tax relief to other classes of property through local income taxes.

Relief for Farmers
Farmers who own a home and live on their farm would benefit from the elimination of property tax payments on the residential portion of their property. By removing Homestead taxes, the average farmer would see a 40 percent reduction in his total property tax bill.

Long Term Security
A Local Government Security Trust Fund would be established under the plan to capture income and sales tax revenue above the amount required for Homestead tax replacement. The fund’s balance would be regulated by the state and used to replace shortfalls in revenue or to guarantee bonds for local projects.

For more information on Senator Hume, his legislative agenda or other State Senate business call 1-800-382-9467 or visit http://www.senatedemocrats.in.gov./





2 comments:

Secret Squirrel said...

Only "Homestead" property, which saves your primary residence from tax foreclosure. But, the "shuck & jive" rental property clause looks a bit fishy. If you want to piss-off businesses, which have the money to sue you, go forward with it. The GA already got a spanking from the rental property owners association in '03.

Sort of looks like he did some academic masturbation whilst watching Styring's video...The replacement theories look like they were the product of hybridization, of Styring and Miller. If I recall, he introduced something similar at the '06 session. That was shot down in a big hurry. But, they also unanimously voted for abolition of property tax, as their last empty gesture of that session.

They had better find the handle on this pot, VERY SOON! Because, I have the feeling all of the fuel they are throwing on the fire beneath it is about to burn them. But, this is the same fellow we saw, cosying up to the (Turn-Coat) Vice-President of the Indiana Farm Bureau--Over lunch at Loughmiller’s, after the first Legislative forum…

Unless the ELIMINATE all of it, the problem will keep coming back--Pure and simple. The problem is, as with all miscreant behaviour, none of them want the transparency. Thieves always want to be hidden. Sloppy thieves always get caught. See you at Loughmiller’s Mr. Hume.

Anonymous said...

Putting Democrats in charge of taxes collected above what is necessary, with Bauer in charge of the trust fund is like putting a pack of fox around the henhouse. More tinkering and razzledazzle, no elimination of any bureaucracy in the assessment practice. How long til they decide your house is valued too high and won't qualify. We shall see..