After weeks of hinting about tax reform, Kentucky Governor Steve Beshear has provided some details.
The governor announced the creation of a blue ribbon tax commission tonight in Lexington and the annual Chamber Day dinner put on by the Kentucky Chamber of Commerce.
In a news release, Beshear says Lt. Gov. Jerry Abramson will be the chair of the new commission, and the commission’s main focus will be to raise revenue.
Beshear did not name any other members of the commission. They will be appointed at a later date.
The tax commission was a major platform of Republican Senate President David Williams, who ran against Beshear in last year’s gubernatorial race.
House Speaker Greg Stumbo has signaled he is open to tax reform, but he wants a clear purpose for any attempts to change the tax code. For years, various members of the General Assembly have proposed their own tax reform options.
The commission will hold public meetings, but won’t present any legislation until next year’s General Assembly session.
Beshear’s press release on the commission lists five priorities:
· Fairness: The Commission will review the tax burden that different taxpayers shoulder, from Kentucky families to Kentucky businesses, from small businesses to big businesses, and within different industry sectors in the state. The tax system should treat people equitably.
· Competitiveness: Any changes to the tax system should ensure that Kentucky continues to attract jobs and investment to the state, while keeping and protecting the jobs and businesses we already have. The Commission will review how Kentucky compares to other states regarding business taxes, and identify ways to improve business tax competitiveness.
· Simplicity and Compliance: A tax system should be easy to understand and follow. The Commission will make recommendations to ensure compliance with Kentucky’s tax system is simple for individuals and businesses and to ensure efficient administration by the state.
· Elasticity: The tax code should allow state revenue performance to mirror economic performance. While Kentucky’s code has performed well during the recession, revenues may not keep pace once the economy recovers.
· Adequacy: The tax reform process should create a tax system that provides adequate revenue to fund critical state services. The tax structure should allow revenues to grow along with the economy.