Hendricks County Flyer, Avon, IN

February 27, 2013

Pence vows to push for tax cut

By Maureen Hayden
CNHI

INDIANAPOLIS — Having failed to convince state lawmakers in his own party to embrace his tax cut plan, Indiana Gov. Mike Pence is taking his message on the road.

At a press conference Wednesday, the Republican Pence said he was "burning up a lot of miles around Indiana" to convince Hoosiers that House Republicans are wrong to want to spend more money on roads and schools rather than pay for a 10 percent reduction in the state income tax - a key campaign promise he made last year.

Pence, repeating his oft-repeated phrase that he's "very disappointed" that GOP lawmakers have so far rejected his tax-cut plan, said he's going on the road to promote it "cheerfully, respectfully, and relentlessly."

He said he's been traveling the state "at a pretty brisk pace, talking to Hoosiers in diners and at dinners and at everywhere in between" about the tax cut that Republican legislators have called unsustainable. Asked if he planned to start running TV ads to bring pressure on Republican legislators, Pence declined to answer specifically, though said he wouldn't be spending any money raised for his transition into office on "a political activity."

He also wouldn't rule out the possibility of vetoing the budget bill if it didn't contain his proposed tax cut, though said it was too early to speculate.

Pence's comments came two days after Republicans who control the Indiana House passed a $30 billion, two-year budget that increases funding for transportation infrastructure and education by more than $520 million. Missing from the House plan is what Pence has said is his number one priority: a reduction in Indiana's individual income tax rate from 3.4 percent to 3.06 percent. It would reduce state revenues by $720 million in the first two years as it's phased in, and $500 million a year after that.

Pence, citing the state's $2 billion surplus, said he's convinced the state can afford the revenue reductions that would result from his tax cut, even with the looming federal sequestration, the automatic budget cuts, set to hit March 1, that will reduce federal education, military, and other payments to the state.

So far, Pence has failed to convince the Republican lawmakers who have super-majorities in both the House and Senate of the same.

House Democratic Leader Scott Pelath of Michigan City, whose caucus voted against the House budget bill because it didn't include enough money for education, mocked the split between Pence and GOP lawmakers, saying the latter group was "ruining" the new governor's "honeymoon."

Meeting with reporters Wednesday morning, Pelath predicted that Senate Republicans would try to make some kind of deal on the proposed tax cut as a way to "salvage the governor's dignity."

But Senate Republicans have also expressed their skepticism of the Pence plan; the chairmen of the Senate appropriations and the Senate tax and fiscal policy committee have both questioned whether the state could afford the long-term impact of the revenue reductions it would bring.

So Pence is out drumming up support for the plan with Hoosier voters, hoping they'll put some pressure on their legislators. Pence said his tax cut plan is getting a good reception from audiences around the state, though he complained that people didn't know enough about its details.

As Pence told reporters Wednesday, he's convinced that his tax cut plan will lead to more job creation by reducing the tax burden on small business owners and leaving more dollars in the pockets of working Hoosiers.

Under the plan, the average Hoosier would see their tax burden reduced by about $100. A small business owner making $200,000 a year would see a reduction of about $1,000.

Senate Minority Leader Tim Lanane of Anderson questioned how successful Pence will be in trying to convince voters to pressure GOP lawmakers to trade off more dollars for schools and roads, for Pence's tax cut. Lanane said when he's met with voters at public forums, they don't support the tax cut: "They say, 'We have better things to spend it on.'"