Sales Tax Exemption Dropped from Tax Bill

A  House committee voted 10 to 6 Monday to approve a tax simplification bill that would, among other things, eliminate more than two dozen tax credits. But it doesn't go as far as Gov. Mike Pence had wanted.

Pence’s proposed tax bill, sponsored by Rep.Todd Huston, a Republican from Fishers, aims to simplify the tax code by, in part, eliminating more than two dozen tax credits.  It also included a change to a sales tax exemption for Hoosier businesses. 

But while the Pence administration estimated the cost of that change at around $35 million, legislative fiscal analysts put its price tag as high as $230 million. Since that issue hasn’t been solved, Huston said, the sales tax exemption change had to go.

“Because, again, we can’t yet quite get to a fiscal amount that is appropriate and meets the objectives of the bill to be largely revenue-neutral,” Huston said.

Huston’s amendment in committee also spared several tax credits from the chopping block, including a credit for donations made to Indiana colleges and universities.