Tuesday, April 14, 2009

Tax Reform Talk

This from Ronnie Ellis in the Glasgow Daily Times:

...When lawmakers adjourned three weeks ago, there was talk of a June special session – either to look at House Speaker Greg Stumbo’s bill to allow electronic slot machines at horse tracks or to take a look at tax reform. Senate President David Williams, R-Burkesville, downplayed the likely need for a special session.

During the session, two lawmakers from opposite ends of the political spectrum offered bills to change the state’s tax code. Rep. Bill Farmer, R-Lexington, wants to eliminate individual and corporate income taxes and extend the sales tax to services. His legislation anticipates the actual sales tax rate might also be reduced.

Rep. Jim Wayne, D-Louisville, wants to extend the sales tax to some services used primarily by the affluent and to make income taxes more progressive, taxing upper income levels at higher rates while reducing taxes for the lower end of the income spectrum.

Both Beshear and Stumbo said at the close of the session they are willing to look at tax reform during the interim period before the legislature convenes in January, but some lawmakers have said it could be taken up during a special session.

“We have committed to looking at tax reform and various (other) options that are out there,” Stumbo said.

Senate Appropriations and Revenue Committee Chairman Charlie Borders, R-Grayson, said this week that “everything would be on the table” as lawmakers deal with Kentucky’s seemingly chronic revenue shortfalls and a faltering economy.

Borders and House A&R Chairman Rick Rand, D-Bedford, have been talking of ways the state can respond to any additional shortfall, Stumbo said. The new Speaker said he’s advising House Democrats to prepare for the worst.

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