Bills revamping taxes, tightening benefit rules draw vetoes |  Health

Bills revamping taxes, tightening benefit rules draw vetoes | Health

By BRUCE SCHREINER – Associated Press

FRANKFORT, Ky. (AP) — Kentucky’s Democratic governor on Friday vetoed bills that would revamp the state’s tax code and tighten rules for public benefits, continuing his pushback against the Republican legislative agenda.

In his latest flurry of vetoes, Gov. Andy Beshear targeted a measure aimed at gradually phasing out individual income taxes while extending the state sales tax to more services. He also vetoed legislation that would add new rules and restrictions to Kentucky’s public benefits system.

The GOP-dominated legislature will have a chance to override those vetoes and others when lawmakers reconvene next week for the final two days of this year’s legislative session.

Beshear criticized the tax measure, saying it would create new taxes on 35 services and industries. The new taxes, he said, would hurt industries and undermine economic development incentives. The bill imposes new taxes on hybrid and electric vehicles at a time when the state is “poised to become a world leader in manufacturing those vehicles and their batteries,” he said.

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The governor also warned that the bill would threaten Kentucky’s economic future, claiming that other states damaged their economies by drastically cutting income taxes.

Republicans fired back against the veto — a back-and-forth that’s likely to continue into next year’s elections, when the governor will seek a second term in GOP-trending Kentucky.

“At a time when Kentuckians are facing historic inflation and the state coffers are brimming with money, Andy Beshear believes your money belongs to him,” said state Republican Party spokesperson Sean Southard. “Kentucky Republicans believe your money belongs to you.”

The tax measure features conditions that have to be met to trigger incremental drops in the state’s personal income tax rate, which is now at 5%. The tax rate could drop by a half percentage point at a time if the formula’s targets are achieved. The first rate cut could come as soon as Jan. 1, 2023, according to Senate Appropriations and Revenue Committee Chairman Chris McDaniel.

“We do firmly believe in lowering the income tax rate in this state,” McDaniel said recently. “But it has to be done responsibly. And this is a very gradual way to accomplish that safely.”

In vetoing the bill tightening rules for public assistance benefits, Beshear said the measure would threaten access to crucial food and health care benefits.

“This bill will hurt our families, seniors, children and those with disabilities, and it will disproportionately affect the regions of the commonwealth that lack access to health care, food, child care and other assistance Kentuckians depend on,” the governor said in his veto message.

Supporters of the public-benefits bill offered assurances it wouldn’t hurt people in need of help.

“The only way you can lose benefits is if you’re doing something illegal or (you’re) able-bodied with no dependents at home,” Republican Sen. Ralph Alvarado said during a debate.

The bill represents a long-running priority among many Republican lawmakers to tighten rules for public assistance. The goal, they said, is to wean more Kentuckians off such programs as Medicaid and food stamps and into jobs that make them self-sufficient. The sweeping proposal’s lead sponsors are House Speaker David Osborne and House Speaker Pro Tem David Meade.

The bill would add new rules for such benefits as food stamps and Medicaid. In some cases, it will require “able-bodied” Medicaid recipients without dependents to participate in “community engagement” activities, such as jobs or volunteering.

Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.

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