Republicans and Democrats are braced for a fight over whether state government in Kansas should cash in on the ramifications of the 2017 federal tax cut. The sides are staking out their positions and could come to loggerheads sooner rather than later.
Republican legislative leaders want to push the tempo and pass legislation in time for the upcoming filing season to return what they call a windfall to Kansas taxpayers. Democrats want to hold off and say lawmakers need to wait and see if there even is a windfall.
When Congress, at the behest of President Donald Trump, overhauled the federal tax code in late 2017, that meant a minority of Kansans who itemized on their state tax returns could no longer do so. Some Kansans will end up paying more to the state without the option to itemize.
At stake are millions of dollars. Estimates vary, but the boon to the state from the federal overhaul may be upwards of $100 million. Legislation could give all of that back to Kansas taxpayers by letting them itemize again and tweaking business tax rules. The cost to the state could be bigger if lawmakers include other tax relief.
Republican Senate President Susan Wagle has created a special committee to swiftly tackle the issue.
Provide relief to Kansas families and businesses, allowing them to fully benefit from the Trump tax cuts, Wagle urged in a statement.
The committee could debate and even vote on a bill as soon as next week.
Wagle has reportedly called for them to come up with a clean bill, one that would return the windfall and not get bogged down by delving into other areas of tax policy.
An effort to address the windfall last year narrowly failed with Democrats and some Republicans concerned that the legislation had ballooned with unrelated tax cuts that prompted unanswered questions about the financial impact to the state budget.
Sen. Caryn Tyson, chairwoman of the standing tax committee, was the Senates top negotiator in that failed effort. She is conspicuously absent from Wagles new special committee.
Still, Tyson would support legislation that comes out of the special committee.
This money was intended for the Kansas taxpayer, she said in an interview. It was not intended to grow Kansas government.
Tyson wants a fix in place before most Kansans file their 2018 taxes. Democrats say it would be more prudent to wait until the state has a better handle on collections.
The top Democrat in the Kansas House, Rep. Tom Sawyer, points out that the federal tax cut came with a lot of changes to the tax code some with positive effects on the state coffers and others with negative effects.
Sawyer said the updated state revenue forecast in May will reveal the true impact of the federal overhaul.
