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[r23] Largest tax cut in Hoosier history
Start Date: 4/27/2013Start Time: 12:00 AM
End Date: 4/27/2013End Time: 1:59 AM
Entry Description
Largest tax cut in Hoosier history

STATEHOUSE — Authored by the Chairman of Ways and Means, State Representative Tim Brown (R-Crawfordsville), House Enrolled Act (HEA) 1001, the biennial budget for the State of Indiana, was the last bill passed this session with a 70 to 30 vote and sent to the Governor for his signature to become law.  

“The Hoosier economy has outpaced neighboring states and much of the nation because of the conservative budgeting principles enacted by the Legislature; getting government out of people’s way so they can start and build a business and create jobs is what makes Indiana great,” said Bill Friend (R-Macy). “This budget builds on our state’s accelerating momentum by providing the largest tax cut in state history, increasing funding for education and infrastructure and paying down debt so future generations can enjoy financial freedom. It’s a jobs budget that Hoosiers can be proud of.”

Below are highlights included in the state budget bill:

Focuses on Fiscal Integrity
  • Reduces taxpayer funded debt by repaying $128M in bonds owed on two state facilities
  • Provides cash funding for nearly $225M in state and university capital projects
    o Cash funding will save taxpayers nearly $160M (or 41%) versus debt financing
  • Maintains strong reserve balances at or above 12.5% of annual operating revenues in both years of the biennium
  • Preserves strong structural budget surpluses of over $100M in FY 2014 and $275M in FY2015
Protects Hoosier Taxpayers
  • Provides the largest tax cut in Indiana history
    o When fully implemented, the tax cut package will reduce taxes by $650M+ per year
    o Immediately repeals the death tax (effective January 1, 2013)
    o Cuts the individual income tax rate by 5%
    - Rate will lower to 3.3% in TY 2015 and 3.23% in TY 2017
  • Phases down the financial institutions tax rate to 6.5% over four years and allows for the continued phase‐down of the corporate income tax rate
Invests in Education
  • Increases K-12 education funding by $390M over the biennium
    o K‐12 appropriations exceed pre‐recession funding levels
    o K‐12 tuition support increased by 2% in FY14 and 1% in FY15
  • Provides an additional $30M for K‐12 performance funding in FY15
  • Provides funding to repay charter school start-up loans
  • Creates an Early Education Matching Grant program funding Pre-K education at $2M per year for low-income children
  • Invests an additional $190M over the biennium for higher education
  • Increase funding for student financial aid by $75M over the biennium
Builds and Maintains Infrastructure
  • Provides an additional $215M per year in funding for state and local roads and bridges
    o 47% of the funds will be directed to local units with no strings attached
  • Reserves $400M in the Major Moves 2020 Fund over the biennium for future transportation infrastructure needs
Boosts the Hoosier Economy
  • Increases funding for key workforce development programs such as the Skills Enhancement Fund and adult education over the biennium
  • Funds new innovative initiatives such as the Indiana Career Council, Indiana Works Councils, the Work Indiana program and the Indiana Biosciences Research Institute
Protects the Vulnerable
  • Provides an additional $35M per year to the Department of Child Services for staff and improved behavioral and mental health services; fully funds the Medicaid forecast; and increases funding for a variety of programs that serve Hoosiers in need
“By prioritizing workforce development and K-12 education, we are strengthening the foundation of Indiana’s economy to be prosperous for years to come,” said Rep. Friend. “I am excited to see the state continue to grow and expand with this budget charting a clear path to prosperity. It’s a sustainable path that gives the keys to Hoosiers in driving the economy forward.” 

Contact Information:
Name: Nicholas Goodwin
Phone: 3172329831
Entry Type:
Press Release
Entry Category:
  • Alerts and Notification
  • Announcements
  • Category:
  • Government
  • Agency Name
    House of Representatives Republican Caucus

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