Hawver: Calendar is Ticking

Well, the clock, or rather, calendar, is ticking–or whatever calendars do to make noise—on the tax bill that the Republican legislature sent to Democrat Governor Laura Kelly, who doesn’t want it.

Martin Hawver
Martin Hawver

And…that ticking clock is aiming toward Friday, the 10th day that the governor will have had the tax bill–that she didn’t want passed–on her desk. By or on Friday, she can sign the bill (in which case, we suspect a breath alcohol test would be in order), veto as expected or allow it to become law without her signature (another breath test?).

You know the story, the $220 million bill that she continues to say she doesn’t like and which she said would return Kansas to the former Gov. Sam Brownback “tax experiment” days that drained the state budget and caused massive reduction in services.

The bill is good for an initial estimated $137 million in tax cuts for businesses which have international earnings the federal government is now taxing, about $50 million for individual income taxpayers, about $42 million in reduced sales taxes on food and about $21 million in additional revenues to the state from taxing some Internet purchases. That all adds up to about $220 million less money coming into the State General Fund in the year which starts July 1.

(OK, time for the cultural explainer: Conservatives say that the income tax bill’s provisions aren’t a tax cut, they are merely a tax stabilizer. Those conservatives say Kansas didn’t change the federal tax code that makes more money available for Kansas to tax, and those “adjustments” just keep Kansas from profiting from the federal tax law change.)

Timing is the big issue here. Kelly will have to do something with the tax bill before there are solid numbers on how the federal tax law changes the state’s tax receipts from corporations and individuals.

Kansas leaders aren’t likely to know just how much “extra” federal trickle-down money the state is going to receive from that December 2017 federal tax law change until April 18. That’s when the state’s Consensus Revenue Estimating Group figures out how much money the state is going to take in next year, and presumably how much of it is from those federal tax law changes.

By the way, the Legislature will be on Spring Break on April 18, will return for its “Veto Session” May 1, and have 16 days to work out the tax/budget issue before coming to the end of its traditional 90-day session.

Hmmm…taxes and spending, the two major duties of the Legislature, and so far, there’s been passed a major tax-cutting bill before lawmakers know how much they need to spend next year. Admittedly, lawmakers are working on what they call the “Mega” budget, which is essentially, well…the essentials for operating government. There will be at session’s end the “Omnibus” bill to deal with new expenditures, to reshuffle spending once they know just how much money they will have to spend and to figure out what they can afford.

But the tax bill action this week is going to shuffle everything. Veto the bill, there’s more money to spend, sign (or allow it to become law without the signature of Kelly) and there’s less money to spend.

Who’s in the gunsights: Look for the real scrap to be over the biggest tax reduction, that for corporations, which want the tax cut badly but don’t vote.

The tax bill, interesting fight between the Governor and the Republican-dominated Legislature. We’ll see whether the revenue report April 18 resuscitates any of those tax cuts…

 

By Martin Hawver

Syndicated by Hawver News Company LLC of Topeka; Martin Hawver is publisher of Hawver’s Capitol Report—to learn more about this nonpartisan statewide political news service, visit the website at www.hawvernews.com

Leave a Reply

Your email address will not be published. Required fields are marked *