Tax cuts: Utah Senate approves $160 million income tax rate cut

0

Utah lawmakers are moving quickly to lower Utah’s income tax rate.

One of the first orders of business for the Utah legislature — after cracking down on local COVID-19 restrictions in the early days of the session — was to introduce a bill to lower the tax rate. Utah income from 4.95% to 4.85%.

The Senate on Friday voted 22-5 to approve SB59, which would use all of the $160 million lawmakers have already earmarked for a tax cut in 2022.

It now goes to the House, where lawmakers are expected to add to the tax cut package. An additional $40 million is under consideration to potentially increase Utah’s Social Security tax credit and to create a working income tax credit focused on reducing the even greater income tax rates, especially for low-income Utahns.

That is what should be debated in the House. But for now, the Senate has set the stage with SB59 for a general income tax cut for Utahns.

The amount of the tax benefit will depend on individual and family income, but for a family of four with a median Utah income of about $72,000, the current reduction would mean about $98 more per year, according to the bill’s sponsor, Sen. Dan McCay, R-Riverton.

“Over the past few years, the Legislature has implemented significant tax reductions,” McCay said in a prepared statement released after the Senate vote. “Thanks to a conservative and fiscally sound policy, our state is able to reduce taxes at all levels. Income tax is burdensome for Utah families, and a targeted approach to providing income tax relief will benefit all Utahans.

The Senate voted to approve the income tax cut bill despite rejection from some Democrats, who argued that the state should use the money for critical needs in education, social services and other programs.

Others, including Luz Escamilla, Senate Minority Whip, D-Salt Lake City, opposed tax cuts this year, saying economists have warned of the possibility of an economic “bubble” that could give way to a recession.

“A few years from now (legislators) are going to be sitting here … and we’re going to make budget cuts,” Escamilla said at a press conference with Senate leaders immediately after the vote. “I mean, I think we have to be very careful. And this bubble of much of the surplus stems from a very unique situation that the pandemic has created with the stimulus money. This is my concern.

Republican Senate leaders, however, argued they were taking a measured and cautious approach while funding the tax cut while prioritizing other priorities, including education.

“We are taking steps to reduce the burden on Utah workers while striking a balance to increase funding for education,” said Senate Majority Whip Ann Millner, R-Ogden. “This year, the Legislature plans to lower taxes for Utahans while funding education at historic levels. We are deliberately lowering taxes to this amount and will continue to assess the budget as the federal stimulus unfolds. stabilizes.

This story will be updated.


Source link

Share.

About Author

Comments are closed.