Residents of the state of Kentucky may for the first time be faced with a 6% sales tax on services such as lawn maintenance, car repairs, pet grooming services, and the like. The proposed taxes are part of a tax code overhaul plan by state Republicans that is forecasted to produce $480 million dollars for the state over the next two years.
Lawmakers attending a conference meeting on Monday morning gave their approval to the measure. The plan will now face votes in both the state Senate and House of Representatives, both which are Republican controlled.
The current tax code for the state only allows for a sales tax to be imposed on physical products that are purchased at retail locations. For example, a resident of Kentucky would pay a 6% tax when purchasing a lawn mower but not when paying a local lawn care service to mow their lawn.
There has been a conversation regarding these taxes in the state for some time now and in 2013, a 'blue ribbon' tax commission, organized by then-Democratic Governor Steve Beshear, suggested that a tax be imposed on some services. The plan brought forth by Republicans is said to generate the necessary revenue to restore state programs and services that were victims of past budget cuts.
A major goal to be accomplished with the added revenue is increased per-pupil funding of the state's k-12 education program known as SEEK. The state is looking to increase program spending to $4,000 annually per student.
Other intended uses for the increased tax collection is the rollback of proposed spending cuts to funding for the Mesonet program at Western Kentucky University, an increase in annual pay for social workers in the state, and to reverse a decision by Governor Matt Bevin to decrease monetary funding for the Kentucky State Police.
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