Kansas is “the story of the next decade,” moderator Patrick Gleason said at the Americans for Tax Reform Brunch event on February 22.
Gleason is the director of state affairs for the Americans for Tax Reform and “State of the States” columnist for Forbes.
Sam Brownback, the Republican governor of Kansas, is considered a leader of “one of the most impressive tax reforms of any state in recent years,” according to the Cato Institute. Cato recently completed a study grading governors on fiscal policy and gave Brownback an A, making him only one of four governors in the entire country to receive this grade.
A previous member of the U.S. House of Representatives from ‘95-‘96 and a U.S. Senator until 2011, Brownback has imposed argumentatively one of the boldest, most significant state tax reforms seen in decades nationwide, Gleason said.
Brownback outlined in his event sppech his plans to phase out income taxes in Kansas.
“The objective is to get the income tax off,” Brownback said.
Only Texas has implemented this reform of eliminating the income tax. Brownback, with the passing of SB 78, consolidated three tax income brackets into two, eliminated the tangible property tax, and reduced the income tax more than any other Kansas state tax cut has before.
Kansas previously had the second highest tax rates in the region, but now the state has adjusted income taxes from 6.45 percent to 4.8 percent ,with a statutory down to 3.9 percent in 2018.
In the future, taxes will move to zero on LLC past income. With 75 percent of Kansans working for themselves or for somebody with 10 or fewer employees, Brownback said “the best environment for small business in America is in Kansas.”
According to CATO, the governor “increased the standard deduction, reduced the taxation of small business income, and repealed numerous special-interest tax breaks. The cuts are expected to save Kansas taxpayers about $800 million a year.”
The New York Times reported that “the state’s nonpartisan legislative research department has projected that the budget will face a $213.6 million shortfall in fiscal 2017, in large part because of the deep tax cuts that are expected to cost the state about $3.9 billion over the next five years.”