KENTUCKY — This week on In Focus Kentucky, we’re getting you updated on efforts by lawmakers to further reduce Kentucky’s personal income tax.
During the first week of the 2023 Kentucky General Assembly session, the Kentucky House of Representatives passed House Bill 1, which would codify a reduction in the personal income tax to 4 percent, effective in 2024. This legislation passed 79 to 19 and is now with the State senate for consideration.
Jason Bailey is the Executive Director with Kentucky's Center for Economic Policy. During this segment, he explains why his agency believes recent legislation put forward by lawmakers in Frankfort is "reckless and would doom Kentucky’s schools and other public services."
"The income tax is the largest source of revenue we have to support our schools or hospitals, or human services or infrastructure. It funds about 41% of the budget. And this just takes a big chunk out of it and provides no way to pay for it," Bailey explained.
Kentucky has a lot of excess revenue at the moment due to federal pandemic aid, Bailey said, which won't last forever.
"That's going away. And we have to be able to continue to pay for the things that we all want and need, and prepare for future disasters and so forth. And we can't just give away our largest source of revenue and expect to continue to be able to do that," explains Bailey.
You can watch the full In Focus Kentucky segment in the player above.