On day 21 of the 30-day legislative session, lawmakers moved a revenue bill out of committee that contains fixes and other items dealing with Kentucky’s tax code and more.
House Bill 360, sponsored by Rep. Jason Petrie, was heard Tuesday in the House Appropriations Committee with new language in a committee substitute. Many of the items in the bill, Petrie said, are changes and clarifications asked for by the Kentucky Department of Revenue and the Kentucky Finance and Administration Cabinet.
Among the changes, marketing services are being removed from services that are subject to the state sales tax, exemptions are provided for certain items that have historically been subject to the property tax, and clarifications are added to areas of the tax reforms made in 2022’s monumental House Bill 8, and more.
Additionally, the legislation contains language to allow small business owners to deduct a greater share of their state and local taxes (SALT) from their federal income tax liability. Often known as “SALT parity” or the “SALT cap workaround,” more than two-dozen other states have already passed such bills to provide federal tax relief for small business owners. These bills utilize a tax structure approved by the IRS and have no impact on state coffers. Small business owners save money through a lower federal income tax liability.
House Bill 360 passed through the committee and now moves to the full House.
The legislation could see changes moving forward. Stay tuned to The Bottom Line for more updates.