The Assembly GOP plan calls for increasing the standard deduction on the state income tax effective in 2020. For married taxpayers filing jointly who would qualify for a tax cut, it would average $231, according to the Legislature’s nonpartisan fiscal bureau.
The Assembly GOP plan would reduce state tax collections by about $490 million in the second and final year of the next state budget cycle. That includes an ongoing total tax reduction of $338 million plus a one-time cost of $152.1 million to account for the timing of the change.
In June the state ended the last fiscal year with about $588 million in the general fund after revenues outpaced expenditures by $9.5 million. In the current fiscal year, a $34.1 million surplus is expected to increase the fund balance to $622.6 million. An updated projection on state finances is due from the fiscal bureau next week.
Vos said Assembly Republicans want to advance the tax cut in a separate bill from the state budget.
Senate Majority Leader Scott Fitzgerald, R-Juneau, praised the plan in a statement issued immediately after the Assembly press conference, saying he’s “glad to see that our colleagues in the Assembly are prioritizing plans to lower taxes.” Fitzgerald said he has asked a trio of GOP senators to work “on a plan to deliver tax relief for hard-working families.”
Evers spokeswoman Melissa Baldauff said in a statement the Assembly GOP plan “falls short” of what he seeks.
“The governor’s sustainable plan to cut taxes for middle-class families — which is funded by rolling back tax giveaways for millionaires — would provide relief for 86 percent of taxpayers without adding to the deficit or relying on one-time funds,” Baldauff said.