February 28, 2017
Lisa Christensen Gee
Director of Special Initiatives
February 28, 2017
Before the tea party wave of 2010 that brought Gov. Sam Brownback to power and inspired the disappointing “real life experiment” in tax policy, Kansas was primarily governed by a moderate bipartisan coalition. One thing the last few weeks in the Kansas capital has clearly demonstrated is that this coalition is back and they mean business.
Five years after the legislature enacted the largest tax cut in Kansas history that has wreaked havoc on the state’s budget, the legislature voted to rescind many of these same tax policies—including eliminating the exemption for business pass-through income and adding back a third income tax bracket and higher marginal tax rates.
Like a captain committed to a sinking ship, Gov. Brownback vetoed the bill, to which the House promptly responded with an override—carrying one more vote than needed to do so. While the Senate’s override attempt fell three votes short, the session is far from over. A majority of lawmakers in both chambers voted for the initial legislation and then voted to override the veto. Building on this support, new tax bills have been filed in both chambers, including plans that only slightly vary from the bill that was vetoed (HB 2178). (A plan with lackluster support proposed by Gov. Brownback that would raise alcohol and tobacco taxes has also been filed but unlikely to get much traction.)
When lawmakers pick up the work again the week of March 6, expect to see another wave of efforts to eliminate the business pass-through exemption and to find agreeable adjustments to income tax brackets and rates. The resistance is underway. An improved tax policy will hopefully follow.