Beshear goes against party, signs GOP-backed tax cut bill
Gov. Andy Beshear has signed House Bill 1, a bill that will lower the state’s personal income tax rate from 4.5% to 4%.
The bill was a major priority of Republicans in the statehouse, and passed through both chambers on a party-line basis. Nearly all Democrats voted against it, citing concerns about potential ramifications for the state budget in the future and benefiting the wealthy but not the poor.
Beshear, a Democrat seeking re-election this year, said that he shared some of those concerns about “long-term repercussions for potentially funding state services,” but appreciated that the bill would “put at least a couple hundred dollars in the pockets of most Kentuckians.”
“Things are tough out there. Inflation is real, and while gas prices have come down, your grocery bill is still way too high. While this issue is temporary, it’s still going to last for some time in the foreseeable future and our people need relief,” Beshear said.
Last session, Beshear vetoed the bill that established the mechanism for House Bill 1 and future income tax cuts in 0.5% increments; it also cut the state’s income tax from 5% to 4.5%, which went into effect on Jan. 1. Then, he said he would have preferred to cut sales taxes as opposed to income taxes.
That bill also expanded the state sales tax to previously untaxed goods and services.
As he has previously, Beshear touted a state economy that’s “on fire,” arguing that state coffers can sustain another income tax drop because of that.
“We had the best January in our history and the best January even for income tax despite the fact it just went down. Right now, our economy can certainly sustain not just a decrease in the income tax that has already happened, but another one as well.”
Republican Party of Kentucky spokesman Sean Southard called Beshear’s action a “blatant political move” motivated by concerns about beating a Republican opponent in his bid for re-election.
“This is just the latest example of Andy Beshear taking credit for Republican policies after having previously vetoed them,” Southard said in a statement. “Last year, Andy Beshear vetoed the process which makes today’s Republican tax cut possible. He has spent countless hours attacking Republicans for this policy approach and left the members of his own party out to dry on it.”
This story was originally published February 17, 2023 at 12:12 PM.
