Approximately 335,000 Hoosiers who would have owed the state taxes next year, should be getting money back instead. The reason is the automatic taxpayer refund.
Governor Mitch Daniels announced the amounts of the tax credit amounts Wednesday morning. Those are $111 for single tax filers and $222 for those filing a joint return.
Daniels says that means a 13% tax cut for the typical, single filer.
"One in four Hoosier taxpayers will receive at least a 25% discount. One in seven will receive at least a 50% refund of their taxes, and one in ten will receive it all back."
Indiana closed the 2012 Fiscal Year with reserves of nearly $2.2 billion. The automatic taxpayer refund was triggered since the state’s reserves exceeded 10% of the total state budget.
Daniels says he’s satisfied the refund still leaves enough in the state’s reserves.
"Fiscal experts generally say that a solid reserve is something in the high single digits. I think I always felt it should be higher than that just for safety's sake, and I think the recession we went through proved to a lot of people that six, eight, nine-percent is not enough."
He thinks current state spending and projected tax collections will produce another rebate next year.