Kansas Senate panel OKs bill raising taxes, eliminating exemption

A tax proposal far different than Gov. Sam Brownback’s quickly moved through a Kansas Senate committee Tuesday morning, setting up a clash between the governor and the Legislature. The legislation would generate roughly $660 million over two years as the state faces budget shortfalls.

The bill raises two income tax rates and ends the income tax exemption for roughly 330,000 business owners. The bill would move the bottom rate from 2.6 percent to 3 percent. The higher bracket would go from 4.6 percent to 4.9 percent.

Sen. Julia Lynn, an Olathe Republican, said the discussion needs to head to the Senate floor.

“This is a situation that has been floundering for four years, and although it might not be the best bill that’s put forward, it’s the beginning of a process,” Lynn said. “It’s tough for everybody on this committee, but our constituents expect us to take action and to take it firmly and to go forward and clear up what is currently a situation that needs to be fixed.”

But not every senator on the committee wanted to move so quickly.

Sen. Marci Francisco, a Lawrence Democrat, said she didn’t feel comfortable addressing anything other than the LLC exemption.

She was the only senator on the committee with a recorded vote against the bill.

“We need to, I think, look at other issues of tax fairness that this committee has not had a chance to fully debate,” Francisco said.

Brownback sent a strong signal Monday that he was against the tax plan, meaning the bill will likely need veto-proof support to take effect.

But in a brief interview Tuesday morning after the bill was approved by the committee, the governor said he would not commit to vetoing the bill.

“I don’t know of anybody looking at a broad based income tax increase,” Brownback said about the United States. “The trend lines away from that and away from taxing productivity.”

This story was originally published February 7, 2017 at 11:03 AM with the headline "Kansas Senate panel OKs bill raising taxes, eliminating exemption."