BISMARCK, ND (KXNET) — Today the Office of the Governor and Office of the State Tax Commissioner jointly announced a landmark tax relief plan that would replace the state’s individual income tax rates with a single, lower flat tax.

The initiative for the proposed flat tax will save North Dakota taxpayers an estimated $250 million every year and eliminate the individual income tax burden altogether for nearly 60% of the state’s taxpayers.

With the state’s excess funds “overflowing,” Governor Burgum says it is important that taxpayers are seeing that money back.

“This will allow North Dakota’s hardworking North Dakotans to keep their money to help offset inflation or expenses but also to invest in their families and invest in their communities. Every North Dakota income taxpayer will benefit from this,” Gov. Burgum said. 

This is considered a historic tax reform measure for state taxpayers. Governor Burgum says this is the “relief for all plan”.

With a 1.5% income tax rate, this would be the lowest rate in the nation. Representative Craig Headland says the goal is to hit zero percent in the future.

“This tax reform proposal will make North Dakota the lowest flat tax rate in the nation. It’ll help solidify our position as an employment destination for job seekers not just in North Dakota but across the country as well. This is critical at a time where workforce recruitment challenges exist not only in North Dakota, but across the country,” State Tax Commissioner, Brian Kroshus says. 

Although this is great for those who fall under those income levels, a big question many North Dakotans want answered is, what about property tax?

When asked about this, Representative Headland says there is hope for the future to address this, and Governor Burgum says our state needs to reach out to our elected officials regarding this. He says 60% of North Dakotans don’t pay property tax, but 60% do pay income tax.

So, what about the constitution stating that the legislative assembly shall provide for a uniform system of free public schools throughout the state? If we stopped funding schools wouldn’t that relieve a large percentage of the state property tax burden?

Silence, that was the response when asked that question.

Property tax is the real issue those in the crowd say.

This is a developing story.

Three out of five North Dakota taxpayers will not pay state income tax, if they fall under the qualifying incomes.

All other taxpayers will have the rate reduced to 1.5 %.

The draft of the proposed bill was sent out shortly before the show and is available here: