A Kansas state senator with a key role in budget matters said Saturday that he believes Gov. Sam Brownback might consider rolling back a tax exemption that allows more than 300,000 small businesses to avoid state income tax.
Sen. Jim Denning, a Republican from Overland Park, made the comments Saturday on the KCUR public radio podcast “Statehouse Blend.”
Denning said he’s been told that Brownback might not veto a bill that would reverse that portion of the governor’s signature 2012 tax cuts, if the Kansas Legislature sends it to his desk.
In response, the governor’s office issued a short statement.
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“The Governor will always carefully consider any bill the legislature chooses to send him,” the statement read in part. “We will announce our proposals for balancing the budget next week when the new revenue estimates are released. A plan to raise taxes on small businesses or anyone else will not be among them.”
Denning, vice chairman of the Kansas Senate Ways and Means Committee, said he wasn’t certain the Senate was prepared to pass such a bill, but that he thought the governor’s position was more favorable toward such a move than before.
“It’s been signaled already to me personally that he would not veto anything that the Legislature came up with to close that loophole this year,” Denning said. “So that’s a big movement from his position last year when he was 100 percent crystal clear that he was going to veto anything that we did.”
Denning said state revenue estimates would probably be revised downward by $150 million or $250 million when state officials and economists meet next Wednesday.
“This thing is past politics to me,” Denning said on the podcast. “It’s a policy decision. It’s a business decision. We’ve got to keep the trains running, and closing that loophole is such a simple step for me personally, I just don’t see the political fallout.”
Monthly tax receipts in Kansas have fallen short of projections in 11 of the past 12 months. February tax receipts came in $53 million below estimates, and Brownback immediately ordered a $17 million cut to the state’s university system.
Denning also predicted on Saturday that Brownback was planning another $17 million cut to higher education.
The Legislature returns April 27 for its veto session.