Business and Economics

Pence Gets Half His Tax Cut In Budget Deal

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Legislators have reached a deal on a new state budget which gives Governor Pence half the tax cut he asked for.

The House and Senate will vote Friday on a deal which includes a five-percent tax cut, phased in over four years. Your tax rate would go down a tenth of a point on your return for 2015, then dip to a final rate of three-point-two-three two years later.

The long phase-in means legislators will be writing the next state budget before the rate goes down. Senate Appropriations Chairman Luke Kenley (R-Noblesville) says the delay gives the state time to monitor its revenues and spending and gain confidence that the cut is affordable.

The budget also immediately repeals the stateā€˜s inheritance tax, and phases in a tax cut for banks to match the phased-in reduction already on the books for corporations.

Pence issued a statement calling the deal “a great victory” for taxpayers .

The budget leaves a projected surplus of 13-percent of spending.

The budget increases school funding by three-percent over two years, with an additional 32-million dollars set aside to reward top-performing schools and teachers.

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