We returned to Frankfort on Tuesday following the long President’s Day weekend and hit the ground running on the second half of the 2022 General Assembly. In anticipation of the filing deadline on Tuesday of next week, members are filing the last of their bills and resolutions for the Session. The first 30 days of Session saw a number of priority measures pass through the House, including a fiscally responsible state budget, a constitutional and contiguous redistricting plan, and reform of an outdated unemployment insurance system. As the Session continues, I will keep you updated as we push forward priority legislation.

Tax Modernization Bill Aimed at Eliminating Personal Income Tax Filed: I rarely report on bills when they are filed because most measures will change before they come up for a vote. While this is true for HB 8, the tax modernization proposal filed this week, I want to share some details about this bill for you to consider. HB 8 would reduce the personal income tax from 5% to 4% as of January 1, 2023. The bill also includes triggers that call for further reducing the personal income tax until we eliminate it entirely. These changes would be permanent, and they will leave more money in the pockets of working Kentuckians. While the first decrease is paid for with money we reserved in this year’s budget, revenue forecasts show that there is enough growth in our future to sustain this 1% cut, but HB 8 also includes provisions that make it possible to grow revenue in other areas — without an increase in any taxes. Instead, the bill broadens the tax base to include services like pleasure watercraft docking, transportation services like Uber and Lyft, non-medically essential cosmetic surgeries, legislative and executive branch lobbying, and advertising, marketing, and graphic design. I also want to point out that there will be a sales and use tax extended to electrical bills for non-primary residential properties. In other words, if you own a second or third home in this state, you will pay a tax on the electricity you use.

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