Taxpayers should soon get a little bit more money back from the bank, er, state of Indiana. We can use it, to be sure, as inflation soars to heights not seen in 40 years. But we think the state can and should do more.
Gov. Eric Holcomb, facing pressure to suspend the state’s gas tax, announced last week he will call a special session of the Indiana General Assembly to give some money back to the Hoosiers that money belongs to. He’s doing this — again — not because he is feeling generous, but because the law requires excess surplus money to be refunded to taxpayers once the excess cash in the state’s coffers reaches a threshold that is ridiculous.
“Hoosiers have real needs right now during this period of high inflation, from the gas pump to buying groceries, and everyone should benefit from the state’s success,” Holcomb said.
It’s indisputable that Indiana has been wildly successful in at least one regard — holding Hoosiers’ tax money without any plans to use those dollars for the public. So successful, in fact, that this will be the second time in months that the state will have returned money to taxpayers because the law says it must.
Holcomb is asking the state to give back to taxpayers $1 billion, which will amount to individual refunds of $225, or $450 for couples who filed jointly. That would be on top of a refund authorized earlier this year of $125 for individuals and $250 for couples.
Even after that, the state will continue to sit atop a king’s ransom of our tax money, having collected a record monthly haul in April that was $1 billion greater than projected.
“Indiana tax collections have surged over the past year and could push the state’s cash reserves from last year’s record high of $3.9 billion to about $6 billion by the end of June,” the Associated Press reported.
So even if it the state gives back $1 billion, it will continue to have a projected surplus of $5 billion.
We are all for a prudent, thrifty government that effectively stewards public money. But when the state sets consistent and escalating records for hoards of billions of dollars in surplus taxpayer money, something is wrong. This is not serving the public.
When the Indiana General Assembly meets in special session, lawmakers should commit to conducting a comprehensive review of state finances. Indiana should not be in the business of continually overtaxing its residents and holding that money until mandatory refunds are triggered.
Alternatively, lawmakers could view the massive surplus as an opportunity to take some bold actions to address the state’s poor standing nationally on educational attainment and public health measures. Holcomb said he’s committed to doing this after some of the state’s top business leaders recently warned that unless we prioritize health, education and quality of life issues, our economy and our state are headed for rough times in the future.
That $225 refund taxpayer Indiana is considering? Consider that a down payment on reforming a system that should never hoard so much of our money without purpose in the first place.