Indiana Considers School Choice Tax Credit

Hoosier State Governor Mitch Daniels included a $5 million school choice tax credit program in his budget, which will be considered in the state legislature’s special session. According to The Brazil Times:

The Indiana School Scholarship Tax Credit program would provide a 50 percent state tax credit for charitable contributions to qualified scholarship programs serving lower-income families. Children in grades kindergarten-12 could qualify for scholarships to help attend the public or private school of their choice. The program passed the Indiana Senate with bipartisan support earlier this spring on two occasions.

Facing a large state budget deficit, some may be wondering why Governor Daniels would be supporting providing a new tax break. One reason is that his program is likely to generate significant fiscal savings for the state over time. In April, the Friedman Foundation analyzed the fiscal impact of the proposed tax credit plan and found that the program could save as much as $4.7 million in the first year.

If the Hoosier state becomes the newest to offer school choice, it could be a win-win for students and taxpayers.