In just over a month, lawmakers are back in Frankfort for a special session on new boundaries for Kentucky’s legislative districts. But, there are no plans yet to resolve another issue facing the state.
It’s often called real tax reform or comprehensive tax reform. And it’s been on Frankfort’s radar screen for years. Despite numerous proposals, no substantial change in tax policy has come under serious consideration at the statehouse. Gov. Beshear says Kentucky needs a ‘modern tax system’ responsive to a 21st century economy. But, he admits, politicians would rather avoid the topic.
Kentucky lawmakers start their legislative session today where they're expected to consider tax reforms and search for ways to shore up the financially troubled pension system for government retirees. A task force appointed by Gov. Steve Beshear has recommended a series of changes to the state tax code that could generate more than $600 million in additional revenue. A separate legislative task force has recommended pumping more money into the pension system, which has a $33 billion unfunded liability.
Kentucky's Blue Ribbon Tax Commission has wrapped up its work, but Governor Steve Beshear says the biggest challenge to revising the tax code still remains.
Tax reform is on the tip of the tongue every few years in Frankfort. But historically, not much has been accomplished. Beshear will get the commission's latest recommendations for tax reform this week. And it'll be up to him to convince lawmakers that the panel's work is worth turning into law.
After a nearly year-long review, Kentucky's Commission on Tax Reform has approved recommendations that could generate nearly $700 million a year. Some $500 million of that would come from individual income taxes, with another $200 million coming from expanding the state's sales tax to household utilities and several services that have traditionally been exempt.
What is expected to be the final meeting of Kentucky’s Blue Ribbon Commission on Tax Reform is set for next week in Frankfort. The commission members will finalize their recommendations for reforming the state’s tax code Dec. 6.
The Kentucky House speaker said the commission charged with proposing changes to Kentucky's tax code is "backing away" from controversial issues.
House Speaker Greg Stumbo said in a recent interview that the Blue Ribbon Commission on Tax Reform needs to be bolder. He said the appointed commissioners are approaching the tax code issues as if they have political capital to lose, refusing to offer new ideas.
When the Kentucky general assembly tackles tax reform next year, State Representative John Will Stacy says lawmakers might want to take a look at companies that do a lot of business in the state but don’t have much of a presence here. The Democrat says there are many of them. He says,
Economic consultants looking for ways to improve Kentucky's tax system have offered a variety of options that include imposing a tax on food and a variety of services ranging from haircuts to automotive repairs to funerals.