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Senate panel advances bill to accelerate tax cuts, draws warnings on ARPA risk and service shortfalls
Summary
The Senate Revenue & Tax Committee voted to advance SB1, which accelerates scheduled income tax cuts, adds a one-time $150 individual credit for 2022 and aligns section 179 with federal rules. DFA said ARPA recoupment risk is minimal; advocates warned retroactivity and lost revenue would harm services and provider capacity.
Senate Revenue & Tax Committee members advanced Senate Bill 1 after a day of agency briefings and public opposition that warned about fiscal risks and service shortfalls.
Senator Desmayne, the bill sponsor, told the committee the measure "does 3 things": it creates a $150 individual income tax credit ($300 married) for tax year 2022; advances scheduled reductions in individual income tax rates (bringing the top rate to 4.9% effective Jan. 1, 2022) and lowers the corporate rate to 5.3% effective Jan. 1, 2023; and aligns the state's section 179 expense deduction with recent federal changes to aid small businesses.
The Department of Finance and Administration (DFA) described compliance steps with the American Rescue Plan Act (ARPA) and the Treasury's implementing rules. Paul Goring of DFA said Treasury-directed modeling uses a…
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