Kentucky Center for Economic Policy: Tax Plan Is a Tax Shift with Troubling Long-Term Effect on Revenues

The General Assembly introduced a tax bill today that is a shift in taxes away from corporations and high-income people and over to low- and middle-income Kentuckians. Although the official estimate is that it would bring $248 million more in net revenue by the second year, the plan relies heavily on a fading source in a cigarette tax increase and very uncertain new revenues from conformity to the federal tax code. By moving away from more productive income taxes to slower-growing consumption taxes, it will worsen Kentucky’s budget problems in the future.

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