Archive for Friday, April 29, 2016

Kansas House rejects bill to repeal income tax cuts

A conference committee on tax issues agrees to send a bill to the full Legislature that would repeal the 2012 tax cut that exempts more than 330,000 farmers and business owners from paying taxes on their business income.

A conference committee on tax issues agrees to send a bill to the full Legislature that would repeal the 2012 tax cut that exempts more than 330,000 farmers and business owners from paying taxes on their business income.

April 29, 2016, 7:20 p.m. Updated April 29, 2016, 10:29 p.m.

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TOPEKA — The Kansas House on Friday rejected a bill to reinstate income taxes on more than 330,000 farmers and business owners after many of the Democrats and moderate Republicans who have complained most about that exemption for the last five years joined with a number of conservative Republicans and voted against repealing it.

The bill failed on a 45-74 vote. Fourteen Democrats joined 31 Republicans in voting for the repeal. Twelve Democrats, including House Minority Leader Tom Burroughs of Kansas City, joined 62 Republicans in voting against it. Two Democrats and four Republicans were absent.

Lawrence Reps. Barbara Ballard and Boog Highberger, both Democrats, and Republican Tom Sloan all voted in favor of repealing the tax exemption.

Rep. John Wilson, D-Lawrence, voted against the bill.

“I’m sure it can strike people as odd,” Wilson said after the vote. “I weighed this really heavily and we all could have voted for it today, and it’s most likely not going to go anywhere in the Senate, and certainly the governor’s not going to sign it. And even if it passes and the governor does sign it, we’re still going to have to make $290 million in budget cuts. We still have the highest sales tax in the country. We still have no way to pay for schools. And we’re going to be back next year having more tax conversations.”

The exemption was part of a sweeping package of tax cuts that lawmakers passed in 2012. It exempts from state income taxes all of the income people derive from certain business operations such as partnerships, limited liability corporations, sole proprietorships and so-called S-corporations, which are another type of business in which the income of the business is also the personal income of its owners.

The bill would have repealed the exemption starting Jan. 1, 2017, which means the state only would have received revenue from it during the last two quarters of the next fiscal year.

The most recent revenue estimates forecast that Kansas revenues will fall $291 million short of approved expenditures between now and the end of the next fiscal year.

The Kansas Department of Revenue, though, estimated that passage of the bill would only produce about $61 million next fiscal year, and $205 million in the following fiscal year.

Tax negotiators from the House and Senate had agreed earlier in the day to put the bill up for a vote, acknowledging that many lawmakers had insisted on being allowed to cast a recorded vote, and that many of their constituents have criticized the tax policy since it was enacted in 2012.

Rep. Mark Hutton, R-Wichita, who has long been a critic of the business exemption, said many House members want a public vote on the bill, even if it’s a no vote, just so they can be on record about the issue heading into the 2016 election cycle.

“They believe it’s time to at least have the conversation,” he said. “I’ve been saying that since day one of this session. It’s time to have the conversation, it’s time to have the vote, and let’s put it to bed.”

Rep. Stephanie Clayton, a moderate Republican from Overland Park, was one of several moderate Republicans who voted against the bill. She said before the vote that the bill did not go far enough in providing a long-term solution to the state’s financial needs.

“I think that if we’re going to come out of this with responsible budgeting (and) with a balanced budget, which is what the people of Kansas who pay our taxes and run this government for us really deserve, then we need to make sure that we have a very high-quality, solid plan, and we need to make sure that we are working together as a team — House, Senate and the second floor (governor’s office) — to make the best decisions possible for the state,” she said.

On the House floor, though, a number of Democrats argued forcefully in favor of the bill.

Rep. Henry Helgerson, D-Wichita, said the business exemption was effectively shielding from taxation $3.4 billion of income from the 2,400 wealthiest people in Kansas, those who make over $500,000 a year.

“Rather than providing it for state government, rather than providing an equitable tax structure, we’re giving it to the wealthiest of this state,” he said.

He said those individuals, whose incomes average $2.1 million a year, receive 35 percent of the benefit of the exemption for business income.

With the bill’s defeat, lawmakers now must turn their attention to balancing the state’s budget.

Last week, the Brownback administration outlined three options for closing the budget gap, all of which involve sweeping $185 million out of the state highway fund to shore up the general fund, forcing delays in about two dozen major highway expansion and modernization projects. He also is calling for a 3 percent, or $17.7 million, reduction in funding to the state’s six universities.

In addition to those moves, Brownback is asking lawmakers either to allow his administration to sell part of the state’s interest in future tobacco settlement revenue, or allow him to delay for another year a payment into the Kansas Public Employees Retirement System, a payment that was supposed to have been made April 15.

The third option, if lawmakers choose to do nothing, would be to impose across-the-board allotment cuts ranging from 3 to 5 percent to most state agencies and programs, including K-12 education.

After the vote on the tax bill, House and Senate budget negotiators met to hammer out a final budget deal. Late Friday evening, House negotiators offered several compromise positions, including one that allows the governor to delay the $92 million repayment to KPERS, but would repay that money using any excess tobacco money the state receives that doesn’t otherwise go toward children’s programs, plus any excess general fund revenues the state receives above the official revenue estimates.

House budget committee chairman Rep. Ron Ryckman, Jr., R-Olathe, also offered language that would hold K-12 education harmless from any mid-year budget cuts that the governor may need to order.

Senate negotiators are expected to respond to that offer when the budget conference committee meets again Saturday morning.

Some lawmakers think they can wrap the session up and adjourn later Saturday, if they can reach agreement on a budget plan and a few other minor bills.

Comments

Gary Pomeroy 1 year, 6 months ago

"Rep. Marvin Kleeb, R-Overland Park, who chairs the House tax committee, said many House members want a public vote on the bill, even if it's a no vote, just so they can be on record about the issue heading into the 2016 election cycle." Nothing like principled leadership . . . .

David Holroyd 1 year, 6 months ago

And what is to be gained? Businesses will show less income, they know how. The State of Kansas needs to cut spending to balance the budget. In other words, reduce the budget. Are any legislators willing to take a pay cut? If not, they are not serious about the budget.

Alex Landazuri 1 year, 6 months ago

its already bare bones. so much so tha they are now proposing stealing from children, forgoing more payments to kpers and further decimating the highway fund. where do you expect money to come from, a magic hat? you need to let the adults get back to work now....

Dorothy Hoyt-Reed 1 year, 6 months ago

Doesn't matter. These people need to lose their reelection: Supporters of the 2012 Tax Cuts

Representatives (District) Stephen Alford (124) Tom Arpke (24) Rob Bruchman (20) Pete Degraaf (84) Randy Garber (62) Mario Goico (94) Amanda Grosserode (16) Dennis Hedke (99) Brett Hildabrand (17) Kyle Hoffman (116) Steve Huebert (90) Kasha Kelley (80) Mike Kiegerl (121) Marvin Kleeb (48) Peggy Mast (76) Connie O’Brien (42) Leslie Osterman (97) Virgil Peck (12) Randy Powell (39) Marc Rhoades (72) John Rubin (18) Ron Ryckman (115) Joseph Scapa (88) Scott Schwab (49 Sharon Schwartz (106) Gene Suellentrop (91) Jene Vickrey (6)  

Senators  (District) Steve Abrams (32) Terry Bruce (34) Jim Denning (8) Les Donovan (27) Dan Kerschen (26) Jeff King (15) Forrest Knox (14) Garrett Love (38)
Julia Lynn (9) Ty Masterson (16) Ray Merrick (27) Rob Olson (23) Ralph Ostmeyer (40) Mike Petersen (28) Mary Pilcher-Cook (10) Dennis Pyle (1) Caryn Tyson (12) Susan Wagle (30)

Dorothy Hoyt-Reed 1 year, 6 months ago

And these: Supporters of the 2015 Tax Increase

Representatives Steve Anthimides Steve Brunk Mario Goico Daniel Hawkins Dennis Hedke Mark Hutton Les Osterman Joseph Scapa Gene Suellentrop John Whitmer Will Carpenter Kyle Hoffman Steve Huebert Kasha Kelley Les Mason Virgil Peck Marc Rhoades Joe Seiwert Jack Thimesch Kristey Williams  

Senators Les Donovan Mike Petersen Susan Wagle Steve Abrams Terry Bruce Dan Kerschen Forrest Knox Ty Masterson Richard Wilborn

Greg Cooper 1 year, 6 months ago

Thanks, Dorothy, for that list. Now, to all Kansans who are concerned about the tax issue: go to the following link and find your reps and senators and send them an email telling them your opinion of the business welfare act and the largest tax increase on citizens in state history. If enough of you do this, perhaps the pre-election jitters of those folks will be calmed as they see how passionate the voters really are about this subject, and maybe they'll do the right thing.

http://www.kslegislature.org/li/b2015_16/chamber/house/roster

Do this for the state's future. It's critical. We can not wait until they retire.

Kate Rogge 1 year, 6 months ago

Enter the phrase - - 2015-2016 house senate roster - - in the http://www.kslegislature.org screen's 'search the site' field in the upper right corner. Then pick the search's first result. It resolves to the address Greg posted, but I'm guessing the site won't let you jump over the search step to go directly to the results (?).

Greg Cooper 1 year, 6 months ago

Typical Kansas legislative system........

Thanks, Kate.

Ken Hunt 1 year, 6 months ago

Oh Kansas, how far you have fallen for the "Weegie Board" of trickle down economics. All smoke and mirrors. There never was a "Shining City on a Hill." Sadly, the joke is really on us. Please wake up from our hangover of "Voodoo Economics."

Michael Kort 1 year, 6 months ago

Well, it's the Ouija vote !.......... and the Ouija says "that it is no use doing anything to address anything tax wise in Kansas and that doing anything makes no sense to it" ?

Maybe they are ouijaing with "evil spirits" on the other end of the psychic hot line.......or maybe just too much of the "alcoholic spirits" ???

Or it's their Horoscope, that has the transiting sun square the bird bath and trined the garbage can ! Bad omens ( you know ? ) for tax change in Kansas !!!

Maybe their crystal balls have computer viruses or worms and are misleading them ??? Or It is it that their crystal balls must have ate their home work ???

Maybe their lack of positive proactive behavior is due to a lack of the right antidepressant..... or perhaps they need a working antipsychotic drug to cure them of their "flights of foolish fantasy delusions" about a miracle fixing things for them ! Maybe talk therapy with a competent therapist would help them get over their antisocial psychotic life habits???

The true miracle would be if these antifixits all showed up for work tomorrow........and all resigned...... including brownie !

but wait,.......because things are not screwed up enough yet for them to feel comfortable with just walking away and letting sane folks fix things !!!

What in the hell did farmers do to survive before these clowns and their tax scam welfare for farmers arrived ???

Give us a break !!! Could it be that they swam or sank on their own merits ???........Like other privately or publically owned businesses ???

You better hope that none of these people are the doctors at a hospital that you might arrive at after a car wreck because they are so lazy, incompetent and indifferent to their jobs that you will bleed to death or die of completely treatable injuries !!!

Vote these loonies out !!!!

For those of you who like their routines,.......you deserve what they will do to you, to your relatives, neighbors and our state for being stuck on silly !!!

Michael Kort 1 year, 6 months ago

If you want to see how distorted their thinking is, realize that they are giving welfare to farmers who should be allowed to succeed or fail on their own merits just like banks and private companies of all sorts . How better are they than the Federal Gov. ???

The link below is to simple statistics and explainations for why new businesses fail to succeed and stats on how long it takes for new businesses to fail in terms of years .

That businesses fail to succeed is the fault of multiple issues and not necessarily because their incomes are taxed,.....hello !!!

Like MAO, brownie fails to get it that central planing and management of production situations by government seldom works and if this isn't government tax meddaling then the world that is yelling back at brownie must have missed something ???

http://www.statisticbrain.com/startup-failure-by-industry/

You can't help a birds egg to hatch into a bird ! The struggle to breakout of it's egg is part of it's physical development and readiness to live of the bird and meddaling with nature can backfire !

Ditto for tax meddaling to subsidize businesses and make them into welfare clients of society at large .

Richard Heckler 1 year, 6 months ago

In reality:

It's Time To Repeal The GOP

It's Time To Repeal The GOP

It's Time To Repeal The GOP

It's Time To Repeal The GOP

It's Time To Repeal The GOP

The Brownback administration is one toxic enterprise.

Richard Heckler 1 year, 6 months ago

The farmers that are being referenced are large corporate farms NOT family farms = deception.

Which small business people? All or just a privileged few?

In reality:

It's Time To Repeal The GOP

It's Time To Repeal The GOP

It's Time To Repeal The GOP

It's Time To Repeal The GOP

It's Time To Repeal The GOP

The Brownback administration is one toxic enterprise.

Steve Jacob 1 year, 6 months ago

Before the state raises sales tax again, I want to make sure everybody knows the numbers. 9.05% sales tax (6.5 state, 1.0 county, 1.55 city). Add 1% for Oread Hotel, Bauer Farms, and 9th and N.H, not to mention another 6% if you stay at a hotel.

Think about it, a king room tonight at the Oread is $269, that is $43 in sales tax for a night.

Richard Heckler 1 year, 6 months ago

Other cities do this hotel/motel sales tax I must admit it is annoying.

Still it is time to repeal this Kansas GOP...... or whatever they are.

This was a big show in political rhetoric.

Larry Sturm 1 year, 6 months ago

Everybody that voted not to repeal the tax cut needs to be fired or forced to resign.

Larry Sturm 1 year, 6 months ago

How many of the legislatures that voted against the repeal don't pay any taxes under the law, shall we say conflict of interest.

Greg Cooper 1 year, 6 months ago

OK, the posturing is now done. The bill was never meant to pass, but the members who needed to pretend that they had the state's best interests in mind (in order to get re-elected) have had their little show.

By the way, I believe 14 Democrats voted against the bill, just as an aside.

Larry Sturm 1 year, 6 months ago

We will never survive until the rich pay their share of taxes the money pot is running dry.

Kevin Millikan 1 year, 6 months ago

You're gonna get your chance to get rid of these yahoo's people, remember this.. They could care less about you, and more about their accountant.

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