Kansas taxes

After a record-breaking 113 days, the Kansas legislature finally passed a budget and tax deal. On this edition of Up To Date, we analyze the session and take a look at what it was like to participate in, and cover, the  2015 assembly. 

A tax proposal failed Thursday night in the Kansas House by a huge margin. Lawmakers still need to finish work on a budget and a tax plan that covers a shortfall in the budget.

The first tax plan failed on a 3-108 vote.

Some Kansas lawmakers voted against the bill because it didn’t reinstate enough business income taxes or because it canceled future personal income tax cuts. Democratic Rep. Tom Sawyer said the bill raised the sales tax too high.

“Sales taxes are regressive. They affect working families, seniors citizens a lot worse than other taxes,” said Sawyer.

Stephen Koranda / Kansas Public Radio

Lawmakers are in the 105th day of the 2015 legislative session, making it the second longest session in Kansas state history. Legislators are looking for more than $400 million to close the state’s budget gap.

There was hope last weekend that the logjam could break when Gov. Sam Brownback introduced his tax plan. It relies mostly on sales taxes and tobacco taxes to generate revenue.

The bill mostly leaves business income tax cuts in place, because Brownback says they’re spurring economic growth.

Stephen Koranda / Kansas Public Radio

A committee in the Kansas House has advanced a new tax plan aimed at filling a budget hole. The panel voted to send the bill to the full chamber for debate. It would raise the sales tax on non-food items and reinstate some business income taxes that were eliminated in 2012.

Republican state Rep. Mark Hutton, himself a business owner, says it’s a philosophical question. Should Kansas business owners continue to pay zero income tax?

“When we’re asking everybody else in the state to step up and pay more in sales tax. I think it’s commensurate,” says Hutton.

KC Healthy Kids

 

Led by KC Healthy Kids, a nonprofit organization supported in part by the Kansas Health Foundation, a coalition is being formed to guide a legislative effort to exempt food from the state sales tax.

“Cutting the sales tax on food will make it more affordable for Kansans to eat healthier,” says Ashley Jones-Wisner, state policy manager for KC Healthy Kids.

A group meeting Monday will update estimates for Kansas tax collections. The revenue predictions let lawmakers know how much money they have to spend as they write the state budget.

The Kansas Consensus Revenue Estimating Group is made up of members of the governor's administration, non-partisan legislative researchers and economists from universities in Kansas. They meet twice per year. This time, they'll revise the estimate for the current fiscal year and craft a prediction for tax collections next fiscal year.

A $21 million shortfall in September tax collections has renewed the debate on Gov. Sam Brownback’s economic policies heading into the last month of the 2014 campaign.

city-data

There are two big issues in the race for Kansas governor this year: How to fund education and how to grow the economy.

Republican incumbent Gov. Sam Brownback is standing firm on cutting taxes to boost the economy.

Brownback has cut income taxes for individuals and eliminated them for small businesses. He says this will spur business development and thus the economy will grow.

But House Minority Leader Rep. Paul Davis has a very different idea.

Davis says he will drive economic growth by spending more on education.

Conservatives had two reasons for advocating deep cuts in state income tax rates, says one of the legislative leaders who championed them.

The first and most often touted by Gov. Sam Brownback was to lower taxes for business owners so that they could use the savings to create more jobs.

But a second and less talked about goal was to shrink state government by reducing tax collections and forcing legislators to cut spending, according to Senate President Susan Wagle.

The state of Kansas is loaning itself $675 million to ensure that it can pay its bills as it transitions from one budget year to the next.

That’s not unusual.

For the last 16 years, it has been standard practice for the State Finance Council to approve certificates of indebtedness, which transfer money from a fund used to collect fees and pay off bonds to the state’s general operating fund.

Tax cuts in Kansas have "landed with a thud," according to the co-author of a report that criticizes the state's actions for harming public services and sapping the state's long-term economic vitality. 

The report, which was released by the Center for Budget and Policy Priorities, says massive tax cuts enacted by Kansas lawmakers in 2012 have left the state's schools, public health departments and other public services "stuck in the recession." 

courtesy flickr user AgriLife Today / Creative Commons

Tax season is upon us, so it's time to rummage through those shoe boxes of old receipts, dig up W-2 forms and file your 2013 return.

The Cash Money Crew is here to guide you through the process, including changes to be aware of and tips for a smoother tax return season in 2014. Later, we discuss the changing realities of retirement and how to prepare for it.

Guests:

The Kansas business lobby is armed with new data to convince this year’s legislature to press for lower taxes and other change. 

The basis is a Kansas Chamber of Commerce commissioned survey of 300 company owners.

The December 2013 questionnaire found 57 percent of those surveyed thought they paid too much in taxes. Thirty-six percent thought they paid about the right amount. 

The study found less interest than in the past in what plays into the economic border war with Missouri, the poaching of jobs back and forth across state line.

Dan Verbeck / KCUR

Debate over Governor Jay Nixon’s veto of an income tax bill was fierce in the Missouri House and the governor prevailed. 

The Republican majority was unable to muster the votes to make the $700 million tax cut into law.

The measure would have cut business taxes in half. Personal taxes would have been cut disproportionately.

Clay County Democrat Jon Carpenter called it unfair.

Laura Ziegler / KCUR

Kansas is “open for business," according to the enthusiastic proclamation made by Gov. Sam Brownback Thursday morning as he signed a controversial tax bill in Overland Park, Kan.

The governor was referring to the impact of second year cuts in state income taxes that he and supporters claim will attract economic development to the state - enough economic development to offset expected budget shortfalls in coming years.

The chair of the Kansas House Tax Committee is responding to claims from Democrats about the tax plan passed by the Legislature last weekend. The Republican-dominated Legislature passed a bill that will cut income tax rates, but will also keep the sales tax elevated and reduce income tax deductions.

The Chair of the state Democratic Party, former revenue secretary Joan Wagnon, says legislators broke their promise to let a temporary sales tax expire, and put a bigger burden on working Kansans, amounting to a more than $750 million tax increase.

Kansas Legislature

Kansas lawmakers return to Topeka Tuesday to dive back into the contentious debate over budget and tax bills.

State Representatives and Senators were quoted  using words like “dumbfounded” to express  frustration that they can’t agree on either a budget or tax bill.  Lawmakers had planned to wrap up the legislative in 80-days instead of the mandated 90-days.  Instead, the session has run long like it has in most recent years.

Wikimedia Commons - CC

The Kansas House and Senate have passed their versions of both budget and tax plans, but there's still plenty of work ahead. The two chambers will now try to smooth out differences between the plans.