News From Terre Haute, Indiana

Opinion

January 23, 2014

EDITORIAL: Training workforce better strategy than cutting taxes

TERRE HAUTE — Joe Donnelly’s job as Indiana’s junior U.S. senator is national in scope, but he is still a strong advocate for improving the jobs climate in his home state. And his outlook is in sharp contrast to the prevailing Statehouse approach of giving more tax breaks to businesses.

In a Tuesday visit with the Tribune-Star’s editorial board, Sen. Donnelly did not mince words when referring to the state leadership’s preoccupation with addressing the jobs climate by continually trying to reduce business taxes in order to make the state more attractive to job creators.

Donnelly insists that improving job training and work skills for everyday Hoosiers are more important than business tax cuts.

As a federal legislator, Donnelly must deal with issues in a different way than state legislators, but his point is well taken.

“When businesses come to see me …, they [don’t] line up to tell me, ‘Well, look, if you lower our business personal property tax, we’ll come to Indiana,’” Donnelly said.

Rather, he said, businesses tell him that “if you have the trained and skilled people, we’ll be there.”

A favorable tax environment for businesses is part of a successful formula, Donnelly said. But we should not fail to understand that there are good jobs in this state that go unfilled because there are not enough skilled workers available. And cutting business personal property taxes will do nothing to address that problem.

What’s more, cutting business taxes without replacing revenue lost by local communities makes it difficult for local governments to maintain vital services such as police and fire protection at a level a community — and its businesses — expect and demand.

Gov. Mike Pence has asked for the elimination of the business personal property tax, which would cut a billion dollars of revenue from Indiana communities.

Fortunately, legislative proposals being advanced don’t go that far, but they do call for modest, incremental cuts without adequate mechanisms for replacing lost funds for local governments. That’s still unacceptable.

Indiana should continually try to bolster its business climate. Even though Sen. Donnelly operates in the U.S. Congress, his insights should not be ignored in the Statehouse.

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