(Indianapolis, Ind.) - Indiana Governor Mike Pence is getting part of the individual income tax cut he wants for Hoosiers, but is still critical of the Senate budget proposal.
The Senate introduced its version of the budget bill this week. The budget blueprint, which calls for $30 billion in state spending over the next two fiscal years, passed the Senate Appropriations Committee Thursday on a 9-4 party line vote, advancing to the full Senate.
The proposed Senate budget varies from the earlier House spending plan which did not include any tax cut. The Senate’s budget bill includes a three percent cut, which would return about $68 a year to Hoosier families.
Pence has been seeking a 10 percent individual income tax cut, but GOP lawmakers at the Statehouse have not been receptive to the idea. The governor said his 10 percent cut would return $228 annually.
“I think this latest version of the budget is a good start,” Pence said Thursday. “…Now as we enter the final phase of this year’s session of the General Assembly, I believe we are getting on the same page. But let me be clear. There are still details and differences about the levels of spending and priorities.”
Lawmakers are concerned if the state can afford the cut. The governor believes the state has the funds to cover the cut with $2 billion in cash reserves.
The Senate's budget also reduces the tax on financial institutions, an idea Pence voiced opposition towards. Pence was more receptive to the Senate budget's quicker repeal of the state inheritance tax, which lawmakers voted in 2012 to phase out over the next 10 years.
The governor said he looks forward to further negotiations and dialogue with lawmakers on the budget.
“I’ve strongly advocated for providing tax relief for working families, small businesses and family farms by reducing the personal income tax rate. The budget announced today by Senate leadership, I believe, provides a framework for achieving all these objectives,” Pence said.
A budget must be approved by state lawmakers before the 2013 Legislative Session ends April 29. When the Senate approves its budget bill, leaders from the House and Senate would meet to hash out a compromise.