Hendricks County Flyer, Avon, IN

Commentary

May 13, 2013

Tax cuts and an 8.7 percent jobless rate

There were other issues that had potentially greater financial impact or will leave a more resolute imprint on people’s lives, such as Medicaid expansion and Common Core.

But in gauging the success of this year’s Indiana General Assembly, the marquee item came down to the tax cut.

And it was an issue that was finally hammered out just over 48 hours before the session ended.

“There was some very vigorous discussion,” said Gov. Mike Pence, whose first term will be defined, in part, by his pursuit of a 10 percent income tax cut. “We had some disagreements, some in public, more frequently in private. But I think the good news for Hoosiers today is we came together to serve the best interests of Indiana”

A recent Howey Politics Indiana Poll reinforced the notion that Hoosier voters wanted a tax cut. The poll by Bellwether Research showed that while 39 percent supported the Pence tax plan, 33 percent supported the Senate Republican version which called for a 3.3 percent cut. Combined, that was 72 percent favoring some form of a tax cut. Only 17 percent said neither. Still, 60 percent were not supporting Pence’s plan.

Asked when the deal was struck, Pence paused for a considerable moment, then said, “I think it was the night before the deal was announced.” That came when the tax cut package included 5 percent, not 10 percent, on the income tax cut, as well as accelerating the inheritance tax repeal, and a rollback in the corporate and financial institutions taxes.

“After the Senate produced their budget that included income tax relief,” Pence continued, “we began in earnest around this table to meet on a daily basis, sometimes more often, with the fiscal leaders of the House and Senate, and there was a lot of give and take. You’ve got to understand I’m someone who believes you ask for the order and I kept on asking for what we had proposed.”

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