Report backs simpler Indiana local tax system

INDIANAPOLIS (AP) - A new report on Indiana's local income taxes urges state legislators to simplify a system that has seven types of taxes and a two-year lag before the money collected is distributed to local governments.

The Indiana Fiscal Policy Institute report finds that the local income taxes have successfully lowered property taxes throughout the state since they were started in the 1970s.

The Times of Munster reports Indiana University researcher Matt Nagle says the system has become complex.

All but one of Indiana's 92 counties have a local income tax, ranging from 0.1 percent to 3.13 percent.

The Journal Gazette reports the study found that counties collect less than half the possible revenue from local income taxes, but Nagle acknowledged it wouldn't be politically possible for all to set maximum rates.