FRANKFORT, Ky. (LEX 18) — Kentucky House Democrats are pushing back against the Republican-led plan to eliminate the state's income tax, proposing instead to increase taxes on wealthy residents while federal funding faces cuts.
For the last few years, Republican leaders in the General Assembly have prioritized gradually reducing Kentucky's income tax rate to zero. The rate has already dropped from 3.5%, with further reductions planned as long as the state meets specific financial guidelines.
But House Democrats say the state needs to reconsider this approach as federal funding cuts loom.
"As federal funds are cut, the state has to raise more revenue or our people will go hungry. We have to do something," Representative Lindsey Burke said.
Democrats have proposed two alternative tax plans. The first would gradually increase income tax rates for Kentuckians in the mid-range to upper-range income brackets, with rates varying based on income levels.
The second plan targets only the top 5% of Kentucky earners.
"They would be taxed at a rate of 6%. Everyone else would enjoy the march to zero. And the money works that way," Burke said.
However, Republicans hold supermajorities in both the Kentucky House and Senate. Republican leaders have repeatedly told reporters they intend to follow through with their original income tax reduction plan.
