Led by Lt. Gov. Abramson, to develop recommendations to revitalize state’s tax code, bring in more revenue for critical services
FRANKFORT, Ky. (Feb. 9, 2012) – Twenty-three Kentuckians, representing a broad spectrum of public and private sector experience and all corners of the state, will serve on the new Blue Ribbon Commission on Tax Reform, Governor Steve Beshear announced Thursday.
The Commission, to be led by Lt. Gov. Jerry Abramson, will work over the coming months to develop recommendations to make the state’s tax code more responsive to the ups and downs of the economy, as well as to make taxes more equitable for Kentuckians. The revisions should allow for tax revenues that are adequate to address the needs of the state’s citizens and businesses.
“In order to better prepare our state for the future, we must study how we can better align our tax code with the principles of fairness, business competitiveness and a 21st Century economy,” said Beshear. “An improved tax code will not only create a more welcoming business environment, but will also allow the state to invest in the services and priorities that best position our citizens for success.”
In 2011, the national Tax Foundation ranked Kentucky 19th best in the nation both in its business tax climate and in the growth rate of new jobs over the past year. Another recent report by the U.S. Chamber of Commerce ranked Kentucky eighth in the nation for taxes and regulations, and 12th for job growth over the past two years. Despite those high national rankings, Gov. Beshear said the state has room to improve its tax code in order to encourage economic growth.
“This effort to review and revise our tax code is critical, not only for our budget outlook but also for our future economic success as Kentuckians,” said Abramson. “Making the right changes to our tax system will allow us to make the key investments in education and workforce development that will propel Kentuckians into a more secure and successful economic future.”
Commission to hear from public, outside experts
The Blue Ribbon Commission will be assisted by an outside consultant, as well as advisers from both inside and outside of state government. This includes the State Budget Director and Secretaries of the Executive Cabinet, Finance and Administration and Economic Development, the Commissioner of the Department of Revenue, the Taxation Committee of the Kentucky Society of CPAs and the Taxation Section of the Kentucky Bar Association. Legislators from both the House and the Senate will serve as ex officio non-voting members. The Commission will receive testimony from outside experts, interested groups and the general public.
Goals for the Commission
Beshear outlined five goals for the Commission’s work, including:
• Fairness: The tax system should treat people equitably. The Commission will review the tax burden that different taxpayers shoulder, from Kentucky families to Kentucky businesses, from small businesses to big businesses, and within different industry sectors in the state.
• Competitiveness: Any changes to the tax system should ensure that Kentucky continues to attract jobs and investment to the state, while keeping and protecting the jobs and businesses we already have. The Commission will review how Kentucky’s tax environment compares to other states and identify ways to improve business tax competitiveness.
• Simplicity and Compliance: A tax system should be easy to understand and follow. The Commission will make recommendations to ensure compliance with Kentucky’s tax system is simple for individuals and businesses and to ensure efficient administration by the state.
• Elasticity: The tax code should allow state revenue performance to mirror economic performance. While Kentucky’s code has performed relatively well during the recession, revenue growth has not kept pace with changes in the economy.
• Adequacy: The Commonwealth’s tax structure should generate sufficient funds to support critical state services. The Commission is charged with reviewing the adequacy of revenues from the current tax structure and making recommendations for improvement.
Jerry Abramson, Chairman
Roszalyn Akins, Lexington
Pat Mulloy, Louisville
Jason Bailey, Berea
Dr. Sheila Schuster, Louisville
Jim Booth, Inez
Stu Silberman, Lexington
Junior Bridgeman, Louisville
Dr. Lee Todd, Lexington
Rocky Comito, Shepherdsville
Leslie Weigel, Bowling Green
Luther Deaton, Nicholasville
John Williams, Paducah
Marion Forcht, Corbin
Joe Wright, Harned
Rick Jordan, Walton
Cathy Zion, Louisville
Six non-voting, ex officio members will represent the General Assembly:
House Majority: Rep. Rick Rand, Rep. Jim Wayne
House Minority: Rep. Bill Farmer
Senate Majority: Sen. Bob Leeper, Sen. Paul Hornback
Senate Minority: Sen. Gerald Neal
The Commission will work over the next several months, and their recommendations are due to the Governor by Nov. 15, 2012.