Commentary by Larry Lannan
As the Indiana General Assembly begins the 2015 session, there is one proposal that Fishers residents should watch closely. It’s called the commuter tax.
It’s estimated that about 150,000 people work in the City of Indianapolis but commute home to the surrounding counties. A large number of those commuters reside in Fishers.
What is a commuter tax and how would it work? The basic idea is to tax those commuting to work into Marion County and going home to places like Fishers at the end of the workday. The proposal would levy an income tax on those commuters to fund Indianapolis government.
The commuter tax is getting plenty of attention because the Indianapolis Chamber of Commerce is putting the plan into its list of legislative priorities this year. The Indy Chamber argues it is a matter of fairness.
Reporter Sylvia Bao of Indiana Public Media quoted Indianapolis Chamber CEO and President Michael Huber on why this is a priority. “A non-resident income tax, while it is not a perfect solution, would at least provide some relief to Indianapolis so it could provide more of the public safety and transportation, infrastructure resources necessary to deal with that influx of workers,” Huber said.
Should commuters in Fishers be worried about the state imposing a commuter tax on their incomes? I don’t think it’s likely, for a couple of reasons.
First, Fishers residents would be required to pay a tax to a political entity where they have no vote. People in Fishers cannot vote in Marion County elections. The fairness issue can be applied here.
Secondly, the Republican Party has a solid grip on the Indiana General Assembly with supermajorities in the House and Senate. Republicans have made taxes a centerpiece of their political strategy. Don’t look for those in charge of the legislative process to allow a tax increase to pass without a very compelling reason.
Also, Governor Mike Pence has made tax-cutting a major issue. He will likely not look favorably on any proposal to hike taxes in Indiana.
There is no question Indianapolis faces serious infrastructure problems and requires more resources to boost spending on public safety. The question is this – where should Indianapolis get the money?
State lawmakers must grapple with how Indianapolis cleans up its finances. I would argue looking to commuters such as those of us in Fishers for the funding is not the first place to go.