Senators press OLS and Treasury on proposed taxes, revenue estimates and transparency

Senators on the Senate Budget and Appropriations Committee told Office of Legislative Services staff on April 1 that the governor’s proposed FY 2026 tax changes and the public documentation supporting their estimates need more clarity.

"Is there anything in writing, available to us as legislators or even more importantly maybe to the public, on newly proposed tax proposals that describe them, who they will be assessed against and how the revenue estimates were derived?" Senator Zwicker asked. OLS staff replied that the budget-in-brief provides a high‑level description but that detailed policy language and full revenue bases will be available only when bills are introduced.

Senators repeatedly named items in the administration’s proposal. Committee members cited approximately $2.18 billion in on‑ and off‑budget tax and fee increases the budget summary attributes to the administration, of which roughly $1.4 billion were characterized in testimony as newly proposed by the governor. Among the measures discussed were: a new tax on certain live-streaming TV subscriptions and, possibly, broader "digital products" (OLS staff said the budget-in-brief language could be read broadly); a proposed phone tax estimated at about $60 million; and a levy on admissions or uses of sports and recreation venues—billiard parlors, bowling alleys, batting cages, go‑karts, mini golf, skiing lift tickets, swimming pools and tennis courts were cited as examples OLS staff identified when asked.

"We could come up with... billiard parlors, bowling alleys, bungee jumping, fishing piers, go kart rides... swimming pools, and tennis courts," OLS staff said when enumerating venues that could be affected under the budget language. Several senators said those categories are unlikely to survive the legislative process, calling the provisions politically sensitive and noting limited revenue potential relative to the distributional effects.

Senators also asked about two small tax cuts included in the governor's package: a capital gains deduction for qualified small business stock (estimated revenue loss of $10.4 million) and a sales-tax exemption extension for certain baby products and sunscreen (estimated revenue loss of $7.5 million). OLS staff summarized net effects and said when all on‑ and off‑budget increases are included the proposal represented roughly $1.3 billion in additional revenue in the committee’s working figures.

Committee members pressed on whether statutory dedications for new levies would be enforceable. OLS staff said statutory dedications can be altered in an annual appropriations act and that language provisions in appropriations acts frequently transfer funding from dedicated streams to other purposes.

Senators requested that Treasury and the administration share underlying revenue-estimate documentation and draft bill language so legislators and the public can evaluate which services and transactions would be taxed and how the estimates were derived. OLS said staff-level information had been shared, but the public record currently is the budget-in-brief.

The exchange underscored two points for the committee: the governor’s proposal contains multiple new or expanded revenue sources whose legal definitions and incidence remain insufficiently specified in public materials; and statutory dedication does not by itself guarantee long-term protection of new revenue in the annual appropriations process.

The committee signaled it expects Treasury to supply fuller documentation, and senators said they will press for bill language before final votes on the FY 2026 budget.