Kentucky Center for Economic Policy: Using the Federal Income Tax Cuts to Help Address Kentucky’s Budget Challenge
ITEP Work in ActionThe federal tax compromise passed by Congress in December resulted in extensions to a number of tax changes set to expire and provided a large tax break to the wealthiest Americans. Analysis by the Institute on Taxation and Economic Policy shows that the top 5 percent of Kentuckians will receive a tax cut of over $1 billion in 2011 from the enacted income tax extensions alone. Making state income tax changes to reinvest just a portion of these breaks in Kentucky would help protect public investments in education, health and other necessities.