Daily Independent (Ashland, KY)

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February 3, 2014

Beshear to talk tax reform Tuesday

FRANKFORT — Gov. Steve Beshear will unveil his idea of tax reform Tuesday after first sharing it privately with key lawmakers Monday.

Beshear plans a news conference Tuesday at 11 a.m. EST to unveil his proposal which he said Monday will “be wide-ranging with a number of different ideas pulled for the most part” from recommendations of a Blue Ribbon Commission on Tax Reform that issued a report in 2012.

He wouldn’t provide details but said, “No one should be surprised when the proposal is put forward,” because it will reflect many of the recommendations of the 2012 report as well as a dozen other reports over the past couple of decades.

The commission, chaired by Lt. Gov. Jerry Abramson, made 54 recommendations, including reducing some corporate and individual taxes; adding an individual tax bracket; limiting exemptions above a ceiling on retirement income; offering the working poor an earned income tax credit; and applying the sales tax to some services.

In all, the commission estimated its proposals would generate about $659 million in new annual revenue for the state’s General Fund.

But Republicans have resisted the idea of tax reform that raises more revenue, saying they’re more interested in reform which would attract business and jobs to the state. And some Democrats resist the idea of further tax incentives to industries. Beshear has previously hinted he’d like to soften the tax load on the distillery and horse industries.

Beshear met Monday afternoon with Democratic leaders from the House and Senate and planned to meet with their Republican counterparts after Monday afternoon’s legislative floor sessions.

House Speaker Greg Stumbo, D-Prestonsburg, was among Democratic lawmakers who met with Beshear Monday. He characterized Beshear’s plan as “common sense” and said the governor made “very good arguments on some parts of the plan.”

Stumbo offered no details but he hinted the proposal will be modest or balanced among those items sought by Democrats and those preferred by Republicans.

Beshear “realizes it’s a tough issue so he’s tried to craft a plan that has a broad base of support,” Stumbo said.

Senate President Robert Stivers, R-Manchester, hadn’t been briefed on the plan when the Senate adjourned Monday but planned to meet with Beshear.

Stivers said he didn’t know how specific the governor’s briefing would be but he would “honor his request to have a private, confidential communication. Some of these things get out in the public domain and get misconstrued.”

Stivers also said Republicans think they can find savings in the current state budget by “prioritizing spending” when asked if the state needs more revenue.

RONNIE ELLIS writes for CNHI News Service and is based in Frankfort. Reach him at rellis@cnhi.com. Follow CNHI News Service stories on Twitter at www.twitter.com/cnhifrankfort.

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