Beshear Optimistic Coming Off Budget Speech

Jan 22, 2014

Kentucky Governor Steve Beshear

In his budget speech Tuesday night, Governor Steve Beshear told Kentucky lawmakers to expect in the coming days his plan for reforming the state’s tax code.  It's a perennial issue that's seen little movement in the General Assembly. 

However, the term-limited governor told WKU Public Radio that not being up for re-election is an asset.

"Members of the legislature, particularly in the other party, don't view me as a threat in the upcoming statewide elections in 2015 and I think that helps them sit down and work with me in a more productive way," said Beshear.

On the other hand, all of the House is up for re-election this year and half of the Senate.  Still, Beshear said he is sensing a willingness to take a hard look at the tax structure.

Beshear says his tax reform proposal doesn't contain many secrets and most recommendations will come from the Blue Ribbon Commission on Tax Reform chaired by Lieutenant Governor Jerry Abramson. 

"It will be a fluid situation in that I'm going to make an initial proposal and I'm sure there will be a lot of give and take and we'll see what comes out in the end," Beshear added.

The governor declined to say whether or not he will propose tax increases.

"I believe we will become more competitive by lowering some of our rates and broadening the tax base, so we're going to be looking at our income and corporate tax rates to see if we can become more competitive with other states," explained Beshear.

Besehar said he is also looking at broadening the sales tax to apply to services currently not taxed. 

The tax commission issued its final report in December 2012 and made recommendations that would boost state revenue by an estimated $690 million.  Suggestions ranged from raising the cigarette tax to enacting an earned income tax credit for low income earners.

"That report had about 55 recommendations, and obviously not all of those ideas will be in a proposal that I will put forth."