Advantages of the David O Plan over leading alternative proposals:

 

Biggest cut in property taxes

The David O Plan cuts property taxes for homeowners and renters by 62 percent. The Commission on State Tax & Financing Policy proposes reductions of 50 percent for homeowners and 25 percent for renters, while the Governor proposes a 33-percent cut for homeowners and less for renters.

Greatest equity among different taxpayers

The David O Plan does the most to eliminate disparities in tax rates paid by different people. The largest savings will go to people with very high property tax rates, including people who live in areas with government buildings and universities that are tax-exempt and that benefit all Hoosiers.

The David O Plan is the only plan to promise equal relief for homeowners and renters. Renters should not have to pay for tax relief for homeowners.


Relief begins with the 2007 tax bill

All other proposals take effect in 2008. The David O Plan provides relief for the 2007 property tax bill.
David O Plan
for
Property Tax Relief
Legislative
Commission
Plan

Daniels
Plan

Total Property
Tax Cut
$2.5 billion
$1.5 billion
$1 billion
Property Tax Cut
for Homeowners
& Renters
62% homeowners
and renters
50% homeowners
25% renters
33% homeowners
Less for renters
Total Change in Taxes for
Homeowners & Renters
↓$700 million
↓$384 million
N/A
Total Change
in Taxes for
Corporations
↑$300 million
↑$384 million
N/A
Change in
Government
Spending*
↓$400 million
0
0
Increase in
Income Tax
1 percent
(state income tax)
0.6-0.7 percent
(local income tax)
Will require increases
in local income taxes
Increase in State
Sales Tax
1 percent
0.75 percent
1 percent
2007 Relief*
1.5 percent
circuit-breaker
for homeowners
0
0
 
       * — All three proposals will limit future growth in spending.
       N/A — Data not available yet.
 

Greatest immediate cut in government spending

All of the proposals will limit the growth in spending, but the David O Plan is the only one to cut existing spending (by $400 million).

No “unfunded mandates” on local government

Other plans provide property tax cuts and require counties to raise their local income taxes to cover the tax cuts. The David O Plan requires the state to pay for the tax cuts.