LINCOLN- A recent analysis of the EPIC Option Consumption Tax Initiative has noted a number of key inaccuracies in the proposal. The analysis, released by the Tax Foundation, reported that a consumption tax rate of 21.6% percent would be required to totally replace other state taxes — much higher than the 7.5% stated by EPIC backers. The report noted that there are several better ways to achieve relief.

The report further said that the EPIC Option does not prevent local governments from enacting consumption taxes, meaning the total rate could be much higher than advertised. The burden would likely result in substantial cross-border shopping, allowing Nebraskans close to a border with a lower sales tax state to avail themselves of the lower rates while leaving taxpayers in the interior of the state to bear the brunt of the newly established consumption tax.

Due to the high consumption tax rate, the anticipated economic benefits of the proposed tax overhaul are unlikely to materialize. The Tax Foundation warns that the proposal only notes a tax exemption for groceries. This means Nebraskans will be forced to pay new taxes on

medicine, health care, legal advice, dental work, food and dozens of other everyday necessities. The fate of EPIC is currently unclear as it seeking to be placed on the 2024 ballot.

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