Kansas looking for revenue anywhere it can

Optimism was tough to find Thursday among state lawmakers burrowing into sales tax exemptions and tax credits to find new revenue dollars for the beleaguered state budget.

No doubt the state needs the money. A revenue estimating group is scheduled to announce a new projection for fiscal year 2016 on Friday, and the news won’t be good.

One state senator said he’s expecting it to show a $150 million shortfall by the end of June.

After the first of two days of the Legislature’s special committee on taxation, several legislators agreed that it would be difficult to find much money by repealing current sales tax exemptions.

Of the “top 14” exemptions, those that represent the bulk of the dollars lost to exemptions, the biggest was an exemption on “component parts” in manufacturing. Repealing that exemption or others farther down on the list, such as prescription drugs or an exemption for religious organizations, are unlikely to find political support.

Sen. Jeff Melcher, a Leawood Republican, said lawmakers have looked at sales tax exemptions before but rarely make changes.

“I predict we’ll say quite a lot about this and do very little,” he said.

But Rep. Jerry Lunn, an Overland Park Republican, held out hope that the pressure of the growing budget hole will make things different this time.

“It’s possible,” he said. “There’s a lot of motivation to do something.”

Sen. Ty Masterson, Andover Republican and committee chairman, said a review of tax credits might be more promising. The problem, though, is a lack of information about whether the tax credits are achieving their purposes, he said.

“We need a process to regularly review all tax credits,” Masterson said. “That’s something I see coming out of this.”

This story was originally published November 5, 2015 at 5:02 PM with the headline "Kansas looking for revenue anywhere it can."