DALLAS — Kansas Gov. Sam Brownback Wednesday said he will seek a lowering of the state income tax rate that would eliminate 23 tax deductions, including charitable donations, home loans and local property taxes.
Brownback used his state of the state address to the Legislature to outline his proposed budget for fiscal 2013.
“I’m proposing a major step in overhauling our state tax code to make it fairer, flatter and simpler,” he said. “My plan will lower individual income tax rates for all Kansans.”
The governor’s tax plan calls for a reduction in the income tax rate to 4.9% from 6.45% for individuals with income over $15,000 a year and to 3% from 3.5% for the lowest bracket. The income tax on most small businesses would be eliminated.
Brownback said the rate reduction would more than compensate for the loss of all itemized deductions and elimination of credits for adoption and child day care.
“I firmly believe these reforms will set the stage for strong economic growth in Kansas, and will put more money into the pockets of Kansas families and businesses,” Brownback said.
Leaders of the Democratic minority in the Legislature said the Republican governor’s proposal would increase taxes without boosting job creation.
“We will oppose his plan to eliminate the ability of homeowners to claim and itemize the deduction for payment of mortgage interest and local property taxes,” declared Sen. Anthony Hensley of Topeka, leader of the eight Democrats in the 40-member Senate.
“We believe that now is not the time to increase the tax burden on Kansas homeowners,” he said. “Democrats have real concerns about the proposed tax reform and particularly how it will be paid for.”
State revenue from two large casinos scheduled to open soon should be dedicated to the reduction of the state’s bond debt, which Brownback called “a generational burden on our sons, daughters and grandchildren.”
“State government is about to experience an influx of money in the expanded gaming fund with the opening of facilities in Wyandotte and Sumner counties,” he said. “We should use this increased revenue for its most important statutory purpose — to pay down our debt.”
In a televised rebuttal, Rep. Paul Davis, D-Lawrence, said lawmakers should first focus on job creation and use any surplus funds for public education rather than tax cuts.
“We heard a lot tonight about government reforms that might eventually stimulate private-sector growth,” Davis said. “However, Gov. Brownback offered few concrete proposals designed specifically to get Kansans off unemployment rolls and onto a payroll.”