Pharos-Tribune

Columns

March 23, 2014

HOWEY: For Indiana GOP, it’s tax cut ‘showtime!’

I had this really crazy idea: Instead of giving tax abatements to businesses and industry, give them to Hoosier folks who want to build a new home or remodel the one they’re in, particularly with the historic low interest rates that may begin disappearing soon.

The logic here was that for every new home built, there would be dozens of contractors and their workers on each job, and they would be buying brick, granite counter tops, dishwashers and garage door openers. You know, consumer stuff down at Lowe’s.

I brought this idea up to Gov. Mike Pence and he politely thanked me and said he would move it down his administration’s food chain. And that was that.

I couldn’t help but think of Russ Stilwell’s observation in a Howey Politics Indiana column he wrote. The former Indiana House Democrat had asked a southwestern Indiana business executive if the corporate tax cuts Indiana Republicans are addicted to really create jobs. The answer was sobering. They don’t create jobs, he said. They create bigger bonuses for executives and returns to shareholders. The only way to create jobs is to make things that people want to buy.

So it was fun to watch Gov. Pence and legislative Republican leaders pat themselves on the back last week when the Indiana General Assembly concluded. While most of the fiscal focus during the session was on a repeal of the business personal property tax, that was shunted off to a blue ribbon study committee. Individual counties will have the option of repealing it and there is a new “super abatement” available for municipalities to attract big firms from other states. And there would be a corporate tax cut from 6.5 percent to 4.9 percent. Senate President David Long called this the “linchpin” of the legislation.

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