LINCOLN—State Sen. Beau Ballard is accusing Lincoln of improperly collecting its 1.75% sales tax from residents living outside city limits in its three-mile extraterritorial jurisdiction. Ballard plans to introduce legislation in 2027 requiring the city to review 20 years of tax collections and refund improperly collected taxes with interest. Lincoln officials dispute the allegations, arguing that the Nebraska Department of Revenue oversees sales tax collection and refunds. Ballard is also proposing regular audits and potential penalties to prevent future improper taxation.

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