LB 757 - Increased the sales tax rate temporarily from May
1 through December 31, 1982 from 3% to 3.5%.
- LB 17 - Allowed sales tax exemptions for film rentals where
admission is charged, water and energy used in raising livestock,
and custom computer software and training.
59 - Increased the sales tax from 3.5% to 4% for nine months
to create the Cash Reserve Fund. The amount raised was $30 million.
169 - Provided that the Legislature is to set the sales and
income tax rates, beginning January 1, 1984. Prior to this time,
the State Board of Equalization set the sales and income tax rates
on or before each November 15 so that revenue would be sufficient
to fund the enacted budget and so that the two taxes raised similar
amounts for the General Fund.
363 - Eliminated the sales tax on food and the food sales tax
credit against the income tax. Although the sales tax collected
on food and the credit were supposed to be roughly equal, today
the exemption of food costs about $130 million.
- LB 791 - Exempted clinics owned by hospitals from the sales
tax. Cost - $500,000.
796 - Exempted medical oxygen from the sales tax.
892 - Created the Economic Forecasting Advisory Board and set
the sales tax rate at 3.5% and the income tax rate at 19% of federal
- LB 273 - Enacted a sales tax refund for new manufacturing
equipment purchased for a plant expansion or relocation. There was
to be no refund for replacing old equipment. The bill also terminated
a renewable energy income tax credit effective January 1, 1986.
282 - Struck the requirement that the Legislature set the sales
and income tax rates so as to generate similar amounts of money
for the General Fund and the requirement that income tax rates be
changed in increments of one percent and sales tax rates in increments
of one-half percent.
715 - Expanded the sales tax base to include warranties and
service contracts, custom computer software, and some utilities
used by business. Overall, this expansion of the sales tax base
was about $20 million.
- LB 539 - Increased the sales tax rate from 3.5% to
4% effective January 1, 1987.
561 - Exempted prescription oxygen from the sales tax.
1027 - Extended the sales tax to the installation or provision
of cable television or community antennae services and warranties
and service agreements. The bill also exempted sales by booster
clubs and certain farm machinery sold at auction. The net increase
in revenue was estimated to be $1.2 million.
- LB 304 - Extended the sales tax collection obligation
to retailers soliciting sales in this state on a regular, continuous,
or systematic basis by means of advertising.
775 - Enacted the Employment and Investment Growth Act. This
grants income tax credits and sales tax refunds for companies that
hire at least 30 new employees and invest at least $3 million. The
income tax credits are equal to 5% of the increased payroll at the
project for five years and 10% of the investment in the project.
The benefits also include a refund of any sales taxes paid on equipment
or other taxable property purchased in connection with the project.
LB 775 also repealed the two-year-old sales tax refund for purchases
of industrial machinery and equipment for plant expansions. For
projects promising at least $10 million in new investment and 100
new employees, qualifying companies may also receive a 15 year personal
property tax exemption for mainframe computers, certain aircraft,
and agricultural processing equipment used in connection with the
project. For 2000, the cost of the program is estimated to be between
$30 to $150 million depending on the percentage of the jobs claimed
can be assumed to have been in the state regardless of the credit.
- LB 198 - Exempted purchases by the State Fair from
the sales tax.
209 - Exempted carrier access charges between telephone companies
from the sales tax. This bill prevented the assessment of $7.6 million
in revenue annually and more than $37 million in retroactive liability
to telephone companies pursuant to a position of the Revenue Department
taken after the anti-trust breakup of AT&T.
714 - Enacted the current three-choice election for building
contractors for sales tax purposes. Contractors may be treated as
retailers, as final consumers subject to tax, or as final consumers
with a tax-free inventory.
793 - Extended the sales tax to include satellite television
programming and equipment.
- LB 1059 increased the sales tax rate from 4% to 5%
and the income tax rates by 8.5% for 1990 and an additional 8.5%
for 1991 to fund the Tax Equity and Educational Support Act. This
landmark school finance legislation dramatically increased state
aid distributed to schools in an "equalized" manner. School
costs were calculated per student within nine "tiers"
or groups of similarly-sized schools and the formula enabled each
school district to finance the average cost per student for the
tier with a combination of state aid and property taxes at a defined
"local effort rate." The rate varied based on the amount
of appropriation available. LB 1059 also "rebated" 20%
of the income tax paid by residents of the school district to the
district. Total cost when fully implemented was about $210 million.
- LB 300 - Exempted automobile rebates from the sales
444 - Exempted durable medical equipment from the sales tax.
772 - Included sales of entire businesses and their assets within
the definition of occasional sales exempt from tax.
- LB 345 - In addition to a number of administrative changes,
LB 345 changed the sales tax exemption for property incorporated
into real estate to property annexed to real estate and eliminated
the exemption for installation labor. The bill also granted sales
tax exemptions for oxygen used in aquaculture, food sold at political
events, and extended the sales tax refund for agricultural machinery
to depreciable repair parts.
- LB 901 - Exempted copyrighted programming and veterinary
medicine from the sales tax at a net cost of $2 million.
1087 - Restored the exemption for installation labor without
the taxation of such labor ever having been enforced. This exemption
was repealed in 2002.
- LB 430 - Exempted from the sales tax refractory brick
used in the making of steel or cement and molds, dies and patterns
used for injection molding of plastic or stamped from metal. Cost
- $1 million. The exemption for refractory brick was repealed in
- LB 106 - Exempted water, chemicals and feed related
to the raising of livestock from the sales tax. Cost - $3.5 million.
1177 - Created the Municipal Equalization Fund and provided
for aid to municipalities that are unable to raise the average amount
of property tax revenue per capita with the average property tax
levy. The bill also allowed counties to levy a sales tax of up to
1.5% in areas outside municipalities that have a sales tax to support
the county share of jointly provided public safety services.
- LB 1104 - Reduced the sales tax by ½ percent from July
1, 1998 through June 30, 1999 at a cost of $95 million.
- LB 232 - Exempted purchases by Natural Resources Districts
from the sales tax. Cost - $275,000
280 - Exempted mobility-enhancing equipment from the sales tax.
- LB 557 - Exempted purchases by airport authorities
from the sales tax. Cost - $225,000.
- LB 57 - Exempted copies of public records from the sales
123 - Exempted elected county fair boards and drainage districts
from the sales tax.
947 - Brought Nebraska into compliance with the federal Mobile
Telecommunications Sourcing Act by providing that mobile phone use
be sourced at the home or business address of the contract owner
regardless of where the calls are made or received. Increased revenue
to the state was estimated to be about $670,000.
1085 - Enacted a number of temporary tax increases and a permanent
expansion of the sales tax base as follows: (1) Increases the cigarette
tax by 30 cents per pack and the tobacco products tax by one-third
for two years only, beginning October 1, 2002. The proceeds are
to be deposited mostly in the Cash Reserve Fund, (2) Increases the
sales tax rate from 5% to 5.5% for one year only, beginning October
1, 2002, (3) increases individual income tax rates by an average
of 2.2% for tax year 2003 only, (4) Expands the sales tax base to
include services such and building cleaning and maintenance, pest
control, motor vehicle services and installation labor beginning
October 1, 2002. The bill also repealed the previously-existing
exemptions for refractory brick and subscription magazines, and
(5) Requires companies taking advantage of bonus depreciation allowed
by recent federal changes to add back 85% of such depreciation for
purposes of the Nebraska return. The bonus depreciation lost can
be deducted over five years beginning in 2005. Total revenue from
LB 1085 is expected to be $120 million to the General Fund and $30
million to the Cash Reserve Fund.
LB 282 - LB 282 ratified the Streamlined Sales and Use Tax
Agreement as approved by the implementing states, including Nebraska,
on November 12, 2002. The bill also enacted conforming changes to
the statutes that are required to participate with the other states
in the Streamlined System. The bill did not change the tax base
of the state of Nebraska in any way, but many definitions were changed
or moved and all exemptions from tax were relocated to the same
place in the statutes.
The bill also
spelled out all the conditions Nebraska is agreeing to as a consequence
of participating in the agreement. These conditions include using
uniform definitions, sourcing, and rounding rules, providing sixty
days notice for all state and local changes in rate or base, recognizing
out-of-state companies that register for collection through the
governing organization of the agreement, and complying with the
decisions of the governing organization.
759 - LB 759 retained the income tax rates adopted the previous
year instead of allowing the rates to decrease to the 2002 level
after tax year 2003. It also retained the cigarette and tobacco
products tax increase indefinitely, with the proceeds of the cigarette
tax after October 1, 2004 to be deposited in the General Fund. The
bill also increased beer and liquor taxes by about 25%, effective
October 1, 2003.
The bill expanded
the sales tax base to include repair labor, except for repairs to
motor vehicles and farm machinery, RV park charges, newspaper advertising
supplements, animal specialty services, except veterinary services
and services to livestock, and detective services. The bill also
subjected repair or maintenance of personal property, the sales
of which would be subject to sales tax, except for repairs to motor
vehicles to the sales tax.
The bill provided
that all annexation labor, and labor for repairs to real estate
be taxable. However, it also provided exemptions for labor charges
for new construction, the addition of a floor or room, finishing
an unfinished space, restoring or reconstructing a structure damaged
by a natural disaster, or building electrical generating or transmitting
of at least 75% of an existing building is also exempt, but the
contractor is required to notify the Department of Revenue that
that project qualifies for the exemption. Rehabilitation of an existing
building that at least doubles the market value of the building
allows the taxpayer to receive a refund through the Department of
LB 759 was
expected to generate $347 million for the biennium, or $236 million
– LB 841
extended the sales tax exemption for charitable entities to include
intermediate care facilities for the mentally retarded. This change
was consistent with previous interpretations of the exemption.
amended the taxation of construction labor to adopt a statutory
presumption that a taxable project is 60% taxable labor and 40%
materials upon which tax has already been paid. It also provided
a mechanism for contractors or owners to receive pre-approval that
a remodeling project is labor tax exempt.
2005 – LB
312 – In addition to sunsetting the Employment and Investment
Growth Act and replacing it with the Nebraska Advantage Act,
LB 312 exempted manufacturing machinery and equipment from the
sales tax. The bill defined "manufacturing machinery and
equipment" very broadly to include:
used by the manufacturer for transporting raw materials or
components like assembly lines or mill rolls,
and dies for forming cast or injected products and its packaging
to maintain the integrity of the product or environmental
conditions, such as climate control or clean room equipment,
equipment for quality control,
that control a manufacturing process,
used to produce power or energy, such as steam turbines,
or catalysts, solvents, and other solutions even if they do
become part of the finished product, and
or replacement parts purchased for repairing or maintaining
machinery, such as refractory brick.
The exemption also includes all repair and service performed on
such equipment from sales taxes.
LB 753 – Amended
the definition of "construction services" that
are within the sales tax base to include installing, furnishing
or connecting utility services beginning Oct. 1, 2003, the
operative date of LB 759 (2003). What this did is make the taxability
installing telephone or cable lines dependent upon whether or not
the entire construction project is taxable or not based on the
exemptions in LB 759 (2003).
2006 – LB
904 – changed the distribution of state sales taxes
collected on sales of motor vehicles. Previously, the first 5%
of sales tax collected was deposited in the Highway Trust Fund
while any excess over 5% was deposited in the state's General
Fund. After Oct. 1, 2006, these additional amounts, if any
in the Highway Allocation Fund and distributed equally between
cities and counties for their streets and roads.
The bill also
required cities and counties to spend city sales taxes collected
on motor vehicles for street and road purposes
except for pre-existing bonds pledging this revenue for another
968 – In addition
to a variety of income tax cuts, a reduction in the assessment
ratio for agricultural land, and increased
homestead benefits, LB 968 enacted a new sales tax exemption for
construction labor performed on single family homes and duplexes
and a refund for owner-occupied condominiums.
2007 – LB
305 - Directed that sales tax from leasing of motor
vehicles to the Highway Trust Fund, the same as sales
taxes from the sale of motor vehicles. Previously, these funds
flowed to the state general fund.
367 - A multi-faceted tax cut proposal involving
sales taxes, income taxes, property taxes and estate taxes.
sales taxes, the bill repealed the sales tax on construction
labor for commercial projects, effective Oct.
1, 2007. It also granted a new sales tax exemption for community
based wind-energy projects. It also increased the current tax
credit for renewable energy projects slightly and eliminated
the one megawatt capacity requirement to make the credit available
for more projects.