Kan. Senate revises bipartisan plan for raising taxes to avoid deficit in next state budget

Kan. Senate rewrites part of bill raising taxes

TOPEKA, Kan. — The Kansas Senate on Thursday rewrote parts of a revenue-raising plan without touching a proposed increase in the state’s sales tax aimed at preventing cuts in social services and aid to public schools.

The bill would provide $330 million for state government programs during the next fiscal year. It would raise the 5.3 percent sales tax to 6.3 percent on July 1, when the new budget year begins — boosting the cost of groceries, clothing and many other consumer goods.

The legislation originally eliminated an income tax break for some businesses, but senators voted to keep the break in place after some suggested that doing away with it would hurt the economy. Senators also rejected an attempt to add a big increase in tobacco taxes.

The tax bill, drafted by Democrats and moderate Republicans, would be necessary to balance their proposed $13.6 billion budget that protects social services and aid to public schools. Conservative Republicans consider that approach irresponsible.

Senate leaders expected their chamber to vote on the tax bill late Thursday night. Approval would forward the measure to the House, where Democrats and moderate Republicans hoped for an up-or-down vote to send it to Democratic Gov. Mark Parkinson.

The House was considering its own, bipartisan $13.6 billion budget proposal, and Democrats and moderate Republicans there believed it would be quicker and easier to push the Senate’s tax plan to passage than draft a plan of their own.

“We’ve got to wait on the bill to come out of the Senate,” said Rep. Charlie Roth, a Salina Republican who’s leading the House’s bipartisan coalition.

Parkinson has told the Republican-controlled Legislature he won’t accept further cuts to education funding or reductions in social services. But conservatives and many business owners and groups believe raising taxes will prolong the recession in Kansas.

“I don’t think we’re in a position to be discouraging economic development,” said Sen. Karin Brownlee, an Olathe Republican.

The House’s conservative GOP leaders backed a plan that would have cut aid to schools by $86 million, though they said local districts could make up such a loss by tapping reserve funds or raising local property taxes. But that plan didn’t have enough support in the House, and proposals to cut education funding failed in the Senate.

Legislators have considered a variety of tax proposals as they’ve looked for ways to sustain state spending into the next budget year. But over time, they’ve narrowed their options to raising the sales tax.

That trend continued during the Senate’s debate Thursday. Businesses, mostly manufacturing firms, had been targeted for a $17 million tax hike, but the vote was 33-5 to remove that increase from the bill.

Later, the vote was 32-3 against a proposal from Sen. Roger Reitz, a Manhattan Republican, to increase the state’s cigarette tax by $1 a pack, to $1.79 and its 10 percent tax on other tobacco products to 70 percent.

Meanwhile, the House made little progress toward passing a budget for the next fiscal year, despite three hours of debate on its bipartisan spending plan. House leaders suspended debate Thursday evening so Rep. Jene Vickrey, a Louisburg Republican, could attend his mother’s funeral.

Senate tax plan is Senate Sub for HB 2360.

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Kansas Legislature: www.kslegislature.org