The Richmond Register

State News

December 8, 2012

Stumbo, Stivers react to tax talk

FRANKFORT — The prospective state Senate President and Speaker of the House Friday were noncommittal about reaction to recommendations to create $690 million in new state revenues through tax reform.

Democratic Speaker of the House Greg Stumbo, D-Prestonsburg, said he wants to examine the proposals by Gov. Steve Beshear’s Blue Ribbon Commission on Tax Reform further but said it includes at least some things he favors.

Sen. Robert Stivers, R-Manchester, who has been chosen by Republican Senators to be the next Senate President, said he hadn’t seen any details of the recommendations except those listed in media accounts.

“I have not seen the tax commission’s final recommendations and I don’t know if they are in final form,” Stivers said Friday. There are only things released to the press about tobacco tax, reducing the amount of exemptions (for taxing pensions). Those are about the only two things I’ve heard.”

The commission, chaired by Lt. Gov. Jerry Abramson, made a number of recommendations but chief among them are to lower individual and corporate income taxes from 6 percent to 5.8 percent; limit the amount of income exemption which pensioners can claim to $30,000; raise cigarette and tobacco taxes; extend the sales tax to selected services; and to offer a 15 percent Earned Income Tax Credit for the low-income, working poor.

The General Assembly will also face a recommendation to up its contribution to state employee pension funds to more than $300 million in the next budget, which makes the additional revenue more tempting for lawmakers. But any form of new taxes also creates fear among lawmakers who must seek re-election every two or four years.

Asked if he thought the recommended amount had a chance of approval by the Senate, Stivers said any such measure is required by the constitution to start in the House and noted that Stumbo has previously called for the commission to issue “bold recommendations.”

“The better question is to go ask Greg if that’s bold enough for him,” Stivers said. “I don’t know if the House thinks that’s bold enough.”

Stivers said, however, that the Republican Senate thinks the state faces more of a spending problem than a revenue problem.

Stumbo issued a statement Friday that said he’s looking forward to examining the commission’s final report.

“I know Gov. Beshear has asked all of us to keep an open mind, and I believe members of the House will do just that,”Stumbo said. “It has some recommendations I have long favored, such as corporate tax reduction and an earned income credit.”

But Stumbo said again he does not believe any additional tax burden should be borne by the state’s lower-income and middle classes.

Abramson said Thursday he expects to deliver the commission’s final, written report to Beshear on Monday.

Ronnie Ellis writes for CNHI News Service and is based in Frankfort. Reach him at rellis@cnhi.com. Follow CNHI News Service stories on Twitter at www.twitter.com/cnhifrankfort.

 

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