The Kansas Legislature adjourned Sunday after a 99-day session that included approval of a state budget for fiscal 2014 and acceptance of a tax plan that retains most of a temporary sales tax levied in 2010.
The state sales tax will fall to 6.15% from the current 6.3% on July 1. The tax rate was slated to drop to 5.7%.
Gov. Sam Brownback and Kansas Senate fought to keep the rate at 6.3% to offset proposed income tax reductions, but conservative Republicans balked at what they considered to be a tax increase.
The Senate approved the comprise that set the rate at 6.15% on a 24-13 vote The House adopted it by a 69-45 margin.
The income tax proposal drops the top rate to 3.9% from the current 4.9% over five years, with the rate going to 2.3% from the current 3% for those with less than $30,000 of annual income. After fiscal 2018, any increase in annual state revenues of more than 2% will be used to lower the tax rates further.
The standard deduction will drop to $5,500 for head of household, down from $9,000.
An analysis of the adopted tax plan by the Legislative Research Department estimates that it will generate $777.1 million more over the next five years than the current tax law.
However, the analysis also predicts the changes will result in deficit spending of $96 million in 2014, growing to $182 million in fiscal 2018.