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Senate substitutes bill to cut individual income tax; supporters and skeptics weigh education trade-offs
Summary
The Senate substituted and advanced a second-substitute H.B. 323 to reduce individual income tax rates, with supporters calling it a broad, fiscally responsible $100 million cut and opponents warning it would reduce the Uniform School Fund by roughly $100 million and divert funding from education and local governments.
The Utah Senate on Feb. 17 substituted and advanced a second-substitute version of House Bill 323, a proposal to reduce individual income tax rates statewide. Senators debated the scale and distributional effects of the cut and its effect on education funding.
Sen. Hatch moved to replace the original bill with a second substitute that raised the maximum rate in the substitute to about 6.72 percent. Hatch said the revised bill reduces the fiscal impact compared with the House version and estimated the substitute would reduce revenue to the Uniform School Fund by roughly $100 million.
Supporters described the substitute as an across-the-board tax cut that would benefit all Utah taxpayers and claimed it could be enacted without destabilizing core programs. Sen. Thomas argued the proposal would allow continued funding for K–12 and higher education, corrections and public safety needs, and other capital projects while returning money to taxpayers. "This tax proposal ... has the most for the citizens of the state of Utah," Thomas said on the floor.
Opponents expressed concerns about trade-offs. Sen. Aaron said constituents have asked for more education funding rather than a tax cut and urged caution about removing $100 million from the Uniform School Fund. Several senators questioned whether the substitute disproportionately benefited higher-income filers and whether local governments and school districts could be left worse off.
After extended floor debate from multiple senators on both sides, the Senate voted to read the second substitute for the third time; roll call produced 26 yes and 3 no. The bill was advanced for further consideration in the legislative process.
Next steps: the Senate ordered the substituted H.B. 323 for third reading and forwarded it for the next stage; the transcript does not record final enactment.
