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2025 Legislative Session Begins, House Introduces Bill to Reduce Personal Income Tax Rate

Kentucky’s newly elected House and Senate members were sworn in Tuesday to begin the 30-day 2025 legislative session of the General Assembly.

After gaveling in at noon, both chambers adopted rules and introduced several bills and resolutions. Notably, the House introduced a bill to reduce the individual income tax. House Bill 1, introduced by Chairman Jason Petrie, would decrease the individual income tax rate by half a percentage point to 3.5%, effective January 1, 2026.

The House Appropriations and Revenue Committee will meet at 11:30 a.m. Wednesday, January 8, on House Bill 1.

In August 2024, the State Budget Director announced that the state met its revenue conditions, as outlined in House Bill 8 of the 2022 legislative session. This prompted the legislature to make House Bill 1 its top priority this session.

The Kentucky Center for Policy and Research recently released a new report detailing the state’s tax reform efforts and offering recommendations for the Commonwealth’s continued progress. This proposed reduction equates to about $600 million in reduced state income taxes for Kentucky taxpayers. 

Several newly elected officials began their first terms:

Senators Keturah Herron and Steve Rawlings also began their new positions in the Senate today, having previously served in the House.  To view all the legislators, visit https://legislature.ky.gov/Legislators/Pages/default.aspx.

Governor Andy Beshear will give his State of the Commonwealth address on Wednesday, January 8, at 7:00 p.m. ET. The address will be broadcast live on Kentucky Educational Television.

Stay tuned to The Bottom Line for more updates during the 2025 legislative session.

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