February 15, 2021

Kentucky Center for Economic Policy: 10 Ways the Kentucky General Assembly Can Advance Race Equity and Shared Prosperity

ITEP Work in Action

HB 356, sponsored by Rep. Lisa Willner, would go a significant way toward cleaning up Kentucky’s tax code of the many tax breaks that benefit wealthy, predominately white Kentuckians — and would raise over $1 billion in needed revenue annually to invest in equitable and prosperous Kentucky communities. Currently, the state’s tax system plays an active role in exacerbating income disparities. Black and Hispanic families who have lower average incomes face higher average effective state and local tax rates than white Kentuckians. In fact, according to analysis from the Institute on Taxation and Economic Policy, the top 20% of earners in Kentucky, who are predominately white, pay the lowest effective total state and local tax rate. HB 356 would revoke costly bank and corporate tax breaks that have passed in recent sessions and clean up other special interest tax breaks, reinstate the tax on extremely wealthy estates, phase out the retirement exclusion and itemized deductions for wealthier Kentuckians and return to a graduated income tax that asks more of those most able to pay. Combined, these measures would reduce our tax system’s widening of income disparities and help fuel an equitable recovery and future by funding investments in communities and people.

Read more