Indiana budget and tax balancing act

In what could only be called a landslide, Republicans in November claimed 60 of the 100 seats in the Indiana House and increased their majority to quorum proof in the Indiana Senate. Sounds great if you're a Republican ... or does it?

Republicans ran and won with the benefit of the national movement against the Obama administrations stimulus spending and deficit ballooning borrowing. But in the meantime they will be tasked with putting together the budget for our own state, and the risks of forgetting why they won are high.

Recent economic prognostications suggest that the Indiana economy is improving, very slowly, but there will be a budget gap and the constitution requires that the legislature pass a balanced budget. This means spending cuts. Perhaps as much as $500 million in cuts from the previous bi-annual budget.

In the meantime conservatives are clamoring for a tax cut of some kind to show that we're serious about reducing the size of government taxation to help in recruiting businesses:

• The corporate income tax in Indiana is higher than other states and could be decreased
• New State Senator, and personal friend, Jim Banks is looking at the "envy tax" or what is officially called the inheritance tax, that could be decreased.

So how to we cut the corporate or envy taxes, or both for that matter, while also balancing the budget? This will be interesting to watch.