SALT LAKE CITY — With $160 million set aside for more tax cuts this year, Utah's political leaders are preparing to offer something.
What it will be? That will be the subject of negotiations and battles over the 45-day legislative session that begins next week.
"We are now the number one most fiscally sound state in the nation. Number one!" House Speaker Mike Schultz, R-Hooper, said to applause on Monday at the Utah Taxpayers Association's annual legislative breakfast.
At the event, the Speaker outlined his priorities for spending. He noted revenues coming into the state are "flat" and state agencies are bracing for some cuts.
"Education’s super important, transportation’s super important, all the most important things are going to continue to happen," he said. "But we also want to focus on tax cuts."
So far, legislative leaders have set aside $160 million for a modest tax cut to stimulate the economy. It falls in line with modest cuts over the past several years.
"There’s a general feel that reducing income tax makes us more competitive with surrounding states," said Sen. Kirk Cullimore, R-Sandy.
But groups like the Utah Taxpayers Association would like to see lawmakers go deeper. On Monday, questions were asked of Governor Spencer Cox and legislative leaders about the idea of eliminating the income tax entirely.
Most deflected, saying it was a discussion for down the road.
"We’ve got a lot to figure out before we can even go down that road," said Sen. Cullimore. "I think there is some appetite for that, but there’s a lot that needs to be figured out between now and a serious proposal of that."
Speaker Schultz said he was open to the conversation. So was Gov. Cox. Immediately, the Utah State Legislature has to negotiate something going before voters in November: a proposed constitutional amendment to tweak the income tax.
Right now, the income tax is earmarked for public education and some social service programs. Lawmakers are asking voters to allow them to dip into the stable revenue source to fund other budget needs. In exchange, the legislature will drop the state portion of the sales tax on food. That's popular with the public, but the X-factor remains whether teachers unions (a powerful presence on Utah's Capitol Hill) will support or oppose the amendment.
The Utah Education Association — the state's largest teachers union — has been in negotiations with legislative leaders, even after lawmakers approved putting the amendment on the ballot and all sides agreed to keep talking. So far, nothing has emerged about where the UEA will land on it. In an interview with FOX 13 News in October, UEA President Renée Pinkney said the union was in a "no position stance."
On Monday, the UEA said its position had not changed since then. If the unions actively oppose it, that could make the amendment's odds of passage difficult.
"We would like for them to be supportive," Speaker Schultz told FOX 13 News. "But we're also... going to do what's best for our kids and our citizens."
At the Utah Taxpayers Association breakfast, Gov. Cox urged the crowd to support the proposed constitutional amendment.
"This is a win for everyone," he said.
