Tax Reform
Kentucky needs tax reform that is fair,
raises needed revenue, and invests in the
health and well-being of Kentuckians.
At least six rounds of severe budget cuts in recent years have left essential programs and services such as education, environmental protection, health care and many more under-funded and threaten to reverse the progress Kentucky has made in the last two decades. For example, Kentucky nows ranks 50th in the nation in per pupil spending.
KFTC has worked with our partners in the Kentucky Economic Justice Alliance to document how the governor and General Assembly have failed to make a serious investment in Kentucky's future. KEJA's Raising The Bar: Kentucky's Real Budget Report revealed $1.8 billion in funding shortfalls and the resultant failure of schools and programs to meet minimal acceptable standards.
Rep. Jim Wayne's House Bill 506 was introduced to add fairness to our state tax system and raise nearly $200 million in new revenue to begin addressing these critical needs. These proposals were announced at a KEJA press conference on January 19.
House Bill 506
KFTC's position: FOR
Summary | House Bill 506 (Rep. Jim Wayne and others) addressed the major failure of the tax modernization plan passed in 2005 -Kentucky's ongoing budget crisis and the chronic underfunding of essential programs and services. HB 506 was an attempt to make the system more fair and help low-income working families. HB 506 would have raised $200 million in new revenue by: 1) expanding the sales tax to a number of services currently untaxed; 2) creating new individual income tax rates of 7% and 8% for upper incomes; and 3) preserving the estate tax. It also would have established a refundable Earned Income Tax Credit for low-income working families. | |
History | HB 506 was assigned to the House Appropriations & Revenue Committee. On Feb. 7 committee members heard testimony from Rep. Wayne, KFTC and the Kentucky Economic Justice Alliance in support of the bill. It was hoped that provisions of the bill would be incorporated into the House budget. However, the General Assembly ultimately approved a budget with no meaningful reforms or improved revenue. | |
Action | Contact members of the House and Senate Appropriations & Revenue Committee and remind them that Kentucky still needs a budget that is fair, raises needed revenue and invests in the health and well-being of Kentuckians. | |
| HB 506 co-sponsors: Reps. Jim Wayne, Tom Burch, Keith Hall, Joni Jenkins, Mary Lou Marzian, Reginald Meeks, Kathy Stein, Robin Webb | ||
Click here to download a copy of HB 506. | ||