Governor Hoeven's Six Pillars
Real Tax Relief For The People Of North Dakota
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Governor John Hoeven
A $118.6 Million, Broad-Based Tax Relief Package
In May 2007, Gov. Hoeven was joined by legislators and local officials to sign the largest tax relief plan in North Dakota history - a $118.6 million, broad-based package for the people of North Dakota.
Working with the Legislature, we passed a plan that provides a 10 percent income tax reduction against property taxes across the board. This measure, as well as additional financial assistance to counties for schools, State Aid Distribution, oil and gas revenues, social services and other expenses adds up to real tax relief for North Dakota citizens.
The measure includes:
- A 10 percent across-the-board property tax credit against income taxes for homeowners, farmers, ranchers and commercial businesses.
- An expanded Homestead Tax Credit relief for seniors and people with disabilities who own their own homes or rent.
- Elimination of the marriage tax penalty for middle-income couples.
Property Tax Relief: Under the plan, married couples filing jointly, farmers, ranchers and businesses will be able to claim up to $1,000 of their property tax liabilities, and individual income tax payers will be able to deduct up to $500 on their state tax returns. Individuals who don't have a state income tax liability can file for a voucher that they can apply to their local property taxes, or they can carry the credit forward for up to five years.
Tax Relief for Seniors and People with Disabilities: The plan nearly doubles funding for the Homestead Tax Credit program to $8.1 million. The program provides property tax relief for low income seniors and people with disabilities who own homes or rent. Expanded eligibility means a total of 11,350 homeowners will now qualify for the credit, 8,000 more than in 2005; more than 1,700 additional renters will also qualify, for a total of more than 3,000.
Elimination of the Marriage Penalty: The package creates a targeted tax credit of up to $300 to eliminate or reduce the marriage penalty for married taxpayers filing jointly.
In addition to the $118.6 million in tax relief, other funding is helping to reduce the tax burden for local communities, including:
- A landmark $90 million K-12 education funding bill.
- A combined $24 million to counties by assuming the counties' costs for child support enforcement; disbursing more State Aid Distribution dollars; and increasing oil and gas production tax revenues.
A Healthy Reserve for the Future
In addition to tax relief, our budget keeps expenditures in line with revenues, and sets aside a healthy reserve of $356 million for the future. We have:
- Doubled the Budget Stabilization Fund to $200 million.
- Retained $137 million in the Oil Trust Fund.
- Established a $19 million Ending Fund Balance.
