House Passes Local Option Sales Tax Bill, Measure Heads to Senate

Mar 11, 2016

Credit LRC Public Information

Local option sales tax legislation won just enough House votes today, to send the measure to the Kentucky Senate. The constitutional amendment measure is a high priority of the Kentucky League of Cities. 

It takes 60 votes in the House to pass a constitutional amendment bill. The measure, seeking to give local governments an avenue to establish up to a one percent sales tax, was approved 60 to 31. The levy would be used for specific projects and would not be a permanent tax.

During the meeting, which was broadcast on KET, House Speaker Greg Stumbo cited the 1990 sales tax increase used to pay for education reforms as evidence this method can benefit local communities. “By the time we got around to enacting that legislation, the people of Kentucky were aware that it was going for a specific purpose, to improve the educational system in Kentucky. This is the same almost identical concept,” Stumbo says.

Louisville Representative Jerry Miller voted for the measure, but said he wished it was part of a bigger tax discussion. “This local option sales tax needs to be a part of when we do overall tax reform, which I firmly believe we will in the next 13 months,” Miller says.

Among those voting no was Louisville Representative Jim Wayne. Wayne, who has been an advocate for tax reform, says the sale tax is unjust in how it impacts lower income Kentuckians. “The wealthy people know that if they can impose a sales tax, they get off with paying a lower percentage of their income in taxes. And why is that? Because, they don’t spend every buck that they make. The poor people in my district spend every buck that they make to survive," he says.

Tim Couch from Hyden also voted no. “The coal miner that’s retired, 65 years old that has to drive to Lexington to see a doctor. He has to stay the night and he’s gonna have to pay that extra tax, but he doesn’t get to vote on this,” Hyden says.

House bill two won 60 votes, the exact number needed for passage of the constitutional amendment measure. Now, the bill heads to the senate where it has not fared well in the past. If given final approval in Frankfort, the issue would be put to voters statewide.