Politics & Government

Plan to modify business income tax stalls in Senate committee

TOPEKA – Members of the Senate tax committee successfully filibustered Sen. Les Donovan’s tax proposal Thursday, meaning it will be next week at the earliest before the Senate can craft a tax plan.

Donovan, R-Wichita, chairman of the committee, was visibly frustrated and shut down Thursday’s session after nearly an hour of proposed amendments ran out the clock and the senators had to go to their floor session.

He announced that the panel would not meet Friday.

Donovan’s proposal would make owners of pass-through businesses pay some income tax on their profits.

At present, the state has a zero tax rate on business and personal income derived from limited liability companies, sole proprietorships and corporations organized under subchapter S of the federal tax code.

That tax break for more than 300,000 business owners is the centerpiece of Gov. Sam Brownback’s 2012 tax plan.

The House tax plan leaves the business tax break in place and leans much more heavily on sales tax increases to generate revenue to close the state’s $400 million budget gap.

Reach Dion Lefler at 316-268-6527 or dlefler@wichitaeagle.com.