File photo. Photo credit: Utah State Capitol
SALT LAKE CITY – Utah Democrats have introduced a tax reform proposal that would raise state income taxes on the wealthy and change how businesses are taxed.
Under the plan, people making less than $150,000 a year will see their income tax rate cut to 4.64%.
However, those making $150,000 to $250,000 would be taxed at 6%; those making between $250,000 and $600,000 a year would be taxed at 7%; and those with annual incomes above $600,000 would see an 8% income tax.
State Representative Brian King (D-Salt Lake City), the leader of the House Democratic Caucus, disagrees with Republicans’s plans to give everyone a tax cut.
“If you’re relatively comfortable, you’ve done relatively well, that’s wonderful. But you don’t need the same tax relief that someone who is really working hard to make ends meet needs,” King said.
The money would help fund education, and King claims some of the rich support higher taxes.
“To make sure that kids are well educated…most of those folks, they’re ready to step up and help out,” King said.
The plan would also change how businesses are taxed by replacing the 4.85% state sales tax with a 0.9% tax on a company’s gross receipts.
King says their plan is not ready to be formally introduced in a possible special session on tax reform at the Capitol next week, but Republicans are already criticizing it with Speaker of the House Brad Wilson saying it relies too much on “unpredictable taxes”.
Governor Gary Herbert is expected to call a special legislative session on December 12th for lawmakers to take up tax reform, a controversial idea which could fix a multi-million deficit in the state’s general fund.