Economic Insights for Nebraska: Jonathan Williams on Platte Institute’s Nebraskanomics Podcast
Nebraska strives to be more like Utah and less like New York.
Jonathan Williams, ALEC Chief Economist and Vice President of Policy, spoke with Platte Institute CEO Jim Vokal about Nebraska’s economic outlook, their tax policies, and it’s impact on economic competitiveness based on the 16th edition of Rich States, Poor States: ALEC-Laffer State Economic Competitiveness Index.
We have different criteria for taxes, regulation, and labor policy in the areas of economic competitiveness. In Rich States, Poor States, we measure fifteen equally weighted factors. Two factors in Nebraska, personal income and business income tax are well below average. Those tax rates are not competitive in the region, especially when South Dakota and Wyoming have no personal and corporate income taxes. Nebraska, unfortunately, has a personal income tax ranked 43rd nationally. This penalizes people moving up the income ladder, becoming more successful, and it creates more of a tax burden. Nebraska and other states shouldn’t penalize the success of earning additional funds or growing your business.
Nebraska still has a death tax or inheritance tax on the books. That variable in Rich States, Poor States weighs down Nebraska’s ranking. Almost all the other purple or red states repealed their state-level death taxes years ago. They know the horror stories of high-net-worth individuals moving to Florida for warmer weather and taking their tax residency with them so they don’t have to pay any personal income tax or death tax when turning their estate over to their heirs and kids.
Another unique aspect of Nebraska is public power. When you look at the size and scope of government, you focus on the number of public employees per population. Unfortunately, only a few states in the nation have more public employees per population than Nebraska. Those are a few areas that Nebraska could improve moving forward.