Kansas Governor Laura Kelly has announced a special legislative session beginning June 18th to address tax cuts. This move follows the Democratic governor’s veto of three Republican tax cut plans this year, setting up a high-stakes election-year battle with the GOP-controlled Kansas Legislature. In a statement, Kelly expressed her commitment to working with the Legislature to deliver responsible and sustainable tax cuts for all Kansans. She emphasized that a special session provides an opportunity for bipartisan collaboration on comprehensive tax relief that does not threaten Kansas’ solid fiscal foundation. By working together, they aim to swiftly reach a compromise that will put more money back into Kansans’ pockets.
Lawmakers had previously sent Kelly a proposal to cut income, sales, and property taxes by a total of $1.45 billion or more over three years. However, she vetoed the measure after the Legislature adjourned, blocking lawmakers from attempting to override her decision.
Kelly and Republican leaders have agreed on eliminating state income taxes on retirees’ Social Security benefits once they reach an annual income of $75,000. Additionally, they concur on reducing a state property tax for schools and eliminating the state’s set-to-expire 2% sales tax on groceries six months early, on July 1st. However, nearly half of the cuts in the latest bill were tied to changes in the personal income tax, including reducing the state’s highest tax rate from 5.7% to 5.57%.
GOP leaders have expressed increasing frustration as they have made significant concessions, such as abandoning their proposal to move Kansas from three personal income tax rates to one. With all 40 Senate seats and 125 House seats on the ballot in this year’s elections, both Democrats and Republicans recognize the potential impact of tax relief on voters. Democrats hope to break the Republican supermajorities in both chambers, while both parties anticipate voter dissatisfaction if broad tax relief is not implemented given the state’s surplus funds.
