STATE TAX BRIEFING 2023 NEBRASKA TAX & INCENTIVE LEGISLATIVE UPDATE NEBRASKA MAKES A MOVE TO IMPROVE ITS COMPETITIVE BUSINESS CLIMATE BY NICK NIEMANN & MATT OTTEMANN, MCGRATH NORTH LAW FIRM IN OUR “NEBRASKA BUSINESS EXPANSION DECISION GUIDE,” we identified the 22 state and local site selection features most commonly considered by companies when deciding where to locate or expand a business. These 22 features collectively establish the framework for a state’s business climate. While this year’s Nebraska legislative session was memorable for a number of reasons, it was particularly noteworthy in regard to the state’s tax and incentive policies. The Legislature enacted several significant tax and incentive changes, which collectively improved the state’s business climate for attracting and retaining new business. These changes positively impact at least eight of the 22 state and local site selection features: Business State & Local Tax System Workforce Costs Quality of Life State & Local Incentives Skilled Workforce Personal State & Local Tax System Area Cost of Living Workforce Development Below we review some of the most significant tax and incentive changes. The Legislature did leave for another day a number of other important tax and incentive issues, which we also review. In 2016, 2017, and 2018, Nebraska ranked first in the United States in new projects per capita according to the annual report by Site Selection Magazine. By 2021 and 2022, Nebraska had fallen to fifth and 10th, respectively. Although various reasons exist for this, a significant reason for Nebraska’s decline is that other states have been more proactive to improve their business climates than Nebraska has. Overall, the Legislature accomplished a great deal in 2023 to improve Nebraska’s business climate. The Wall Street Journal Editorial Board was impressed. It had this to say in a June 6, 2023, editorial: “The gulf between high- and low-tax states keeps growing, and Nebraska is the latest to use budget surpluses to cut income and property taxes—and in a big way.” Of course, there is still more work to do, as Nebraska is looking to be—and to create a reputation for being—among the best states in which to do business. The annual business survey of U.S. CEOs 19 www.nescpa.org
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