Senate committee hears SB 283 to cut income tax rate and phase out HPIP, PEAK and affordable-housing tax credit

TOPEKA — The Kansas Senate Assessment and Taxation Committee on Tuesday heard testimony on Senate Bill 283, which would reduce individual income-tax rates to a single 5.2% rate by tax year 2028 and discontinue several state tax-credit programs, including the High Performance Incentive Program (HPIP), the Promoting Employment Across Kansas (PEAK) payroll-withholding benefits, and the Kansas affordable housing tax credit.

The committee heard a bill summary from staff and an outline of statutory changes that would take effect after the specified tax years. The bill would phase the top individual income-tax rate from 5.58% now to 5.53% for tax year 2025, 5.45% for 2026, 5.35% for 2027 and 5.2% for tax year 2028 and thereafter, at which point the two-bracket structure would disappear. The bill also would discontinue HPIP, PEAK approvals and additional benefits after specified cutoff dates, prohibit transfers of certain credits after Dec. 30, 2025, and allow existing carryforwards in specified circumstances.

Committee members were told the Department of Revenue is finalizing a fiscal estimate. "We are finalizing our estimate right now, and then it would be passed on to the Division of Budget. I would assume we'd have something probably within the next couple of days," said Kathleen Smith of the Department of Revenue.

A staff estimate presented to the committee by Department of Revenue staff summarized prior…