Armed with a tax reform plan he campaigned on, Governor Ernie Fletcher stopped in Bowling Green Tuesday to host a forum with local business leaders on the issue of Kentucky's tax code.
Fletcher told a packed house at the Carroll Knicely Center that the state is losing too many of its educated native workers to other states because there aren't enough good job opportunities available in-state. To help stop that, and increase the state's tax revenue, Fletcher is proposing a package of sweeping changes to the state's tax code.
In its simplest form, Fletcher's plan would:
- update outdated telecommunications taxes
- reduce state income taxes for about two-thirds of state taxpayers
- reduce corporate taxes while adding more companies to tax rolls
- close tax loopholes for out-of-state companies who do business in-state
Fletcher says his plan will create 7,000 new jobs in its first full year of implementation.
The plan ran into a major stumbling block last year when Senate Republicans insisted that it be tied directly to a state budget, which was never passed. The governor says his plan should still be tied to the budget, because the tax changes will create new revenue streams for the budget.
The tax reform plan also calls for an increase in the state's cigarette tax, one of the lowest in the nation. While no firm number has been set, Fletcher said Tuesday he believes a 40 cent increase could pass the General Assembly.
The Bowling Green forum was the second of 13 such town hall-style meetings the Governor is hosting statewide to tout his plan, which will be taken up by the House and Senate when the General Assembly convenes for business on February 1.
Click here to see the Governor's presentation in its entirety.