(The Center Square) – Kentucky Gov. Andy Beshear warned eliminating the personal income tax would lead to severe changes in the state.
Speaking during his weekly press conference in Frankfort, Beshear, a Democrat running for re-election this year, criticized a proposal made Wednesday by Attorney General Daniel Cameron, the Republican challenger in the Nov. 7 election.
“You cannot go to 0% income tax like Daniel Cameron has pushed without either a massive sales tax increase, which is what he would do, or the gutting of K-12. education, higher education and health care coverage for millions of Kentuckians.”
The Kentucky General Assembly, controlled by Republican supermajorities during Beshear’s tenure, passed a tax reform bill last year over the governor’s veto. That bill established triggers for reducing the income tax and eventually eliminating it if certain economic conditions were met.
That law has already led to the tax being cut from 5% to 4.5% this year and 4% next year. It also expanded the number of services under Kentucky’s 6% sales tax.
While the income tax cut has been triggered for 2023 and 2024, State Budget Director John Hicks informed legislative leaders earlier this month that conditions were not met for an additional tax cut.
In a statement Thursday afternoon, Senate Budget Committee Chairman Chris McDaniel, R-Ryland Heights, said the law is still a success and saved Kentuckians $1.8 billion.
“Naysayers have often criticized comprehensive tax reform and the Kentucky General Assembly’s responsible lowering of working Kentuckians’ income taxes,” McDaniel said. “However, this development is evidence we appropriately weighed the importance of lowering taxes with the need for critical government functions such as education, corrections and more.”
Cameron, during his campaign announcement Wednesday, called out Beshear for vetoing bills that cut taxes while also taking credit for the job growth occurring in the state.
He said if he beats Beshear in November, he would work closely with legislative leaders to further simplify the state’s tax code.
“I will be the governor who eliminates the income tax,” Cameron said.
Beshear countered Thursday by reiterating the economic successes the state has witnessed during his administration. That included 10 companies receiving incentives earlier Thursday to relocate or grow existing operations in the state.
“I’ve delivered record investment, 47,000 new jobs,” the governor said. “My opponent has delivered two posters with platitudes. There is a proven record, and then there are separate plans that won’t work.”