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A Key to Economic Recovery and
Growth in Nebraska
• An ideal tax code is one that is simple, transparent, neutral, and stable, but
many states, including Nebraska, have certain tax provisions that depart from
these principles of sound tax policy.
• The COVID-19 pandemic and associated economic fallout have shed light on
structural deficiencies in states’ tax codes, including narrow-based sales taxes
and taxes that penalize in-state investment.
• States with modern, well-structured tax codes are expected to recover better
from the current recession than states with outdated, poorly structured tax
• To promote short-term economic recovery and long-term economic
growth, Nebraska policymakers ought to reexamine the uncompetitive
and burdensome provisions that currently exist in Nebraska’s tax code and
prioritize those areas for reform.
• Any tax reform plan that is developed in Nebraska ought to prioritize lower
corporate and individual income tax rates, more competitive treatment of
in-state investment, and reduced property tax burdens—reforms that can be
paid for in part by modernization of the sales tax base.
The author would like to thank Maxwell James for his research contributions.
Senior Policy Analyst
TAX FOUNDATION | 2
The COVID-19 pandemic has created immense fiscal challenges for individuals, businesses, and
governments alike. Stay-at-home orders, business closures, and social distancing guidelines have
severely impacted business income and activities, and, in turn, employment and personal income. As
state policymakers look to the months and years ahead, much of the speed of the economic recovery
depends on how much longer COVID-19 remains a significant public health threat. It is difficult for