Topeka — In what was dubbed “tax day,” many conservative Republican House members on Thursday voted to repeal the temporary 1-cent sales tax increase that was approved last year. But that effort failed.
Then many of them voted with the Kansas Chamber of Commerce to make the sales tax increase permanent and use it to help phase out the corporate and individual income tax. That failed too.
Rep. Lance Kinzer, R-Olathe, urged the House to repeal the sales tax increase.
“We need to undo the mistake,” Kinzer said, arguing that the increase has hurt businesses, especially those on the Kansas border near Missouri.
He also said the November election, which increased the House Republican majority to 92 members — the largest in more than 50 years — signaled voters wanted to get rid of the tax increase.
But supporters of the tax increase said it was needed to avoid destructive cuts last year, and if it were repealed would deepen the current budget deficit of $500 million to $900 million. The bill to repeal the increase failed, 39-80.
Gov. Sam Brownback, a Republican who was elected in November, has criticized the sales tax increase but said he didn’t want it repealed.
Last year, the Legislature increased the state sales tax from 5.3 cents per dollar to 6.3 cents per dollar with a portion of the increase helping to pay for the new state transportation plan.
Under the law, the state sales tax will decrease to 5.7 cents per dollar in 2013.
Later, the House considered a bill, sought by House Republican leaders and backed by the Kansas Chamber of Commerce, that would have made the 6.3 cent sales tax rate permanent and used revenue from it to phase out the corporate and individual income taxes.
Rep. Richard Carlson, R-St. Marys, and chairman of the House Taxation Committee, said the proposal would attract more businesses and base more of the tax structure on consumption instead of productivity.
But opponents saw it as a way to starve government funding of crucial services and shift more of the tax responsibility onto poorer Kansans.
Rep. Jerry Williams, D-Kansas City, described it as “Robin Hood in reverse,” arguing the higher state sales tax rate hurts the poor because the tax is applied to essentials, such as food. That bill died 56-61.
The House did advance a bill that allows businesses to deduct from Kansas net income the cost of certain business and machinery.