Gov. Laura Kelly used a trip to Johnson County to lay out legislative proposals for cutting some taxes that she says would save Kansans more than $500 million over the next three years.
Catch up quick: On Monday, Kelly stopped at a Price Chopper in Roeland Park to announce a three-pronged “Axing Your Taxes” strategy that includes:
- a more immediate zeroing out of the 6.5% state sales tax on groceries,
- the creation of a three-day sales tax holiday on school supplies
- and an increase to the income limit at which taxes on retirees’ Social Security benefits kick in.
Key quote: “By cutting taxes on groceries and diapers, school supplies, and Social Security, this plan will put money back in Kansans’ pockets and create real savings for those who need it most,” Kelly said.
Bottom line: Kelly can’t propose legislation herself, and she and her Democratic allies will now need to convince the Republican-dominated legislature to adopt all or parts of her tax relief plan if she wants to see it come to pass.
Grocery sales tax: The first bill proposed by Kelly would immediately bring the state’s 6.5% sales tax rate on food to zero, as well as eliminate state sales tax on diapers and feminine hygiene products.
- Earlier this year, Kelly signed a bill that gradually reduces the grocery sales tax until it is eliminated entirely by Jan. 1, 2025.
- While Kelly said she is still proud of that bipartisan bill, she argued it did not go far enough fast enough: “Kansans still need more relief. The cost of groceries is way too high, plain and simple.”
School supplies: A second bill that is part of Kelly’s new plan would create a three-day sales tax holiday on school supplies every August.
- In addition to school supplies, the tax-free holiday would apply to personal computers, instructional materials and art supplies.
- Kelly said this could also keep Kansans from crossing the state line to purchase such supplies in Missouri, which already has an annual sales tax holiday each August.
Social Security: Finally, Kelly is also proposing a measure that would reduce state income tax on retirees who earn between $75,000 and $100,000 a year.
- Currently, when a retiree earns more than $75,000 annually, all of their Social Security income is taxed, but Kelly’s proposed bill would raise that exemption to $100,000.
- She said the change would save senior citizens an estimated $50 million over the next three years.
Republicans’ views: Republican legislative leaders were cool to the idea of a more immediate end to the state sales tax on groceries when the longer phase-out bill passed earlier this year.
- Then-House Majority Leader Dan Hawkins, a Wichita Republican, said at the time that gradually reducing the tax to zero will allow the state to adjust to the loss in revenue.
- Some GOP lawmakers also suggested during this year’s legislative session that the state could use its growing budget surplus to reduce property taxes, pay down state debt and shore up the state’s rainy day fund.
