TOPEKA — A day after rejecting a bill to eventually phase out state income taxes, the House reversed course and passed an amended version of the measure today.
On a 73-47 vote, representatives approved Senate Bill 1, which would establish a formula to reduce income taxes as other forms of tax revenues rise.
The House rejected the measure Thursday. Today, Taxation Committee Chairman Richard Carlson, R-St. Marys, brought it back in an amended version.
Carlson
The original would have continued indefinitely the three-year, one-percent sales tax approved last year as the state struggled with the recession.
Under the new version, the increased sales tax will sunset on schedule and the rate will drop from 6.3 to 5.7 percent at the end of the three years, Carlson said.
Four-tenths of a percentage point of the sales tax increase will continue, to fund highway projects, as specified in current law.
The bill passed over Democrats’ objections that it would lead to billion-dollar deficits in future years and increase pressure on sales and property taxes to fund state operations.
Wetta
“When it (income tax) is gone, our three-legged stool is cut to two — and the worst two we can choose,” said an explanation of vote filed by Reps. Ann Mah, D-Topeka, and Vince Wetta, D-Wellington. “Sales tax is a regressive tax that impacts low-wage earners most. Property tax is the most hated tax as it makes sure you never really own your property.”
Rep. Jim Ward, D-Wichita, said the state is already facing a $500 million shortfall, and cutting income taxes and the sales tax both will make the situation even worse. Read More »
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