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Beshear to roll out tax reform plan Tuesday
Question of the Day
FRANKFORT, Ky. (AP) - Gov. Steve Beshear said he will present a wide-ranging plan to modernize Kentucky’s tax system, offering no details in advance but saying lawmakers should be well-acquainted with most of the features.
Beshear plans to roll out his long-awaited tax package Tuesday, following through on his promise to present specific ideas on how to make Kentucky more competitive through its tax code. The Democratic governor briefed a bipartisan group of legislative leaders on the details Monday.
“No one should be surprised when the proposal is put forward,” Beshear told reporters Monday.
Beshear offered a few hints, saying his package would include ways to boost the competitiveness of some signature Kentucky industries. He didn’t identify which sectors would be targeted.
One of those well-known sectors, the Kentucky bourbon industry, has been pushing for a corporate income tax credit to offset the taxes it pays every year on whiskey barrels aging in warehouses.
House Speaker Greg Stumbo, D-Prestonsburg, called it a comprehensive package with “common-sense” proposals. It was crafted with an eye toward winning broad support on a tough issue in an election year, he said.
“He’s got some very good arguments … he can make on a lot of the pieces of his package,” Stumbo said.
Senate President Robert Stivers said tax modernization is an issue that needs to be debated.
“If you understand economic development and creation of jobs, you have to look at the tax code,” the Manchester Republican said.
Beshear said his plan, for the most part, stems from recommendations made in late 2012 by a tax reform study group led by Lt. Gov. Jerry Abramson. Many of the ideas have been around much longer than that, showing up in a series of other tax reform studies in past years, he said.
“These ideas have been discussed in detail,” the governor said.
When he formed the review group, Beshear said he wanted a simpler tax code that would generate enough revenue to meet state needs even during recessions.
Kentucky was hit hard by the last economic recession, prompting Beshear to cut about $1.6 billion from the state budget since he took office in 2007. Beshear recommended another $98.6 million in spending cuts in the two-year state budget proposal he recently sent to lawmakers to help free up more money for education.
Beshear insisted Monday there’s plenty of time for lawmakers to debate and pass a tax overhaul. The 60-day General Assembly session will be one-third complete Tuesday.
Last month, in his State of the Commonwealth speech to lawmakers, Beshear acknowledged tax modernization is a “sensitive topic,” especially in an election year. But he said voters elected them to tackle difficult issues.
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