Budget deal calls for 5% income tax cut - Fox 28: South Bend, Elkhart IN News, Weather, Sports

Budget deal calls for 5% income tax cut

Indiana taxpayers will see their personal income tax rate reduced by 5% over the next four years under a budget plan agreed to by state lawmakers.

Gov. Mike Pence had sought a 10% cut as 1 of his signature campaign proposals, but lawmakers were initially cool to the idea.

Improved tax collection estimates earlier this month improved Pence's chances in the waning days of the session.

The tax rate cut will be phased in two steps starting Jan. 1, 2015.

Pence hailed the agreement Thursday as a "great victory" for taxpayers.

The budget plan also calls for repealing the inheritance tax retroactive to Jan. 1 of this year.

State lawmakers must approve the budget before wrapping up their 2013 session. They expect to adjourn Friday.

Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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