News From Terre Haute, Indiana

Local & Bistate

March 8, 2013

Indiana Gov. Mike Pence spends day in city drumming up support for his proposed tax cut

TERRE HAUTE — Lowering the personal income tax rate to Hoosiers through a permanent 10-percent cut will jump start small businesses and the state’s economy, Gov. Mike Pence said Thursday in Terre Haute.

“I really do believe that this is a way that we can jump start this economy. It is the right thing to do. It is the right thing to do for working families and is the right thing to do for small businesses,” Pence told about 200 people attending a Terre Haute Chamber of Commerce luncheon at Idle Creek Banquet Center.

Pence said the 10-percent cut is more money in the long term for small businesses “to take out a loan, buy that piece of equipment or maybe expand your facility and hire a few more people here in this community who are struggling in this economy.”

The governor said the average Hoosier would receive “a couple hundred dollars” while about $500 million would be put back into the state’s economy.

Pence said families could spend money on a child’s education or simply put more money into savings, adding that about 250,000 Hoosiers are persistently out of work and more than 20 percent of Hoosier children live in poverty.

“It is an extremely effective way to strengthen the family budgets all across the state of Indiana,” he said after the luncheon. “It is unquestionably the most effective way to strengthen the balance sheet of small businesses.”

That’s because 93 percent of Indiana business enterprises, Pence said, do not file under a corporate income tax, but instead file under an individual income tax rate. “So the most effective way to lower taxes on job creators is to lower the personal income tax rate,” the governor said.

The cut has hit opposition from within the state’s Republican party, as the GOP controlled Indiana House passed a budget that excluded Pence’s income tax cut.

Pence said the state is in strong fiscal shape and an income cut is feasible.

“First and foremost, I don’t think government should ever collect more money than it needs to operate. And when it is set to collect more than it needs, it ought to find ways to permanently reduce the tax burden,” Pence told the Chamber gathering.

Pence said his budget plan found more than $345 million in excess reserves for infrastructure for the state and local communities. “I am somebody who believes that roads mean jobs,” Pence said.

“Here is my favorite part, especially this close to Illinois,” Pence said. “If we lower taxes across the board permanently by 10 percent on personal income, it will be official. Indiana will be the lowest taxed state in the Midwest and I will put that on every ‘Welcome to Indiana’ sign on every highway coming into the Hoosier state,” Pence said.

“We don’t need to say who is the governor on those signs. Delete that, put in the lowest taxed state in the Midwest,” he said with a chuckle.

The governor also addressed education.

Pence said his budget called for more than $60 million in the first year and $120 million in the second year of the state’s biennial budget for increased funding to public schools. “I believe in funding excellence,” Pence said.

“We can’t succeed in the market place if we don’t succeed in the classroom,” Pence said. “I think the time has come to make career and vocational education a priority in every high school in the state of Indiana again,” Pence said. “I am not talking about a one size fits all career and vocational education vision.”

He said regions of the state need to recognize what job skills are needed for business and industry in their part of the state and design a career pathway.

Pence said rigor, relationship and relevance are three things that are important for education.

“Young men and women are motivated to be successful in education if they see the education that they are being told to get is relevant to their lives,” Pence said.

“I think by creating more fulsome career pathways in our high schools, I think we will move that stubborn graduation rate up dramatically,” the governor said.

Reporter Howard Greninger can be reached at 812-231-4204 or


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