$205 million in tax cuts begin Jan. 1
All told, residents will see more than $205 million in tax cuts for 2008 starting in the new year, Legislative Fiscal Analyst Jonathan Ball says.
The savings will be $85 million in sales and food tax through lower rates and $120 million in personal income taxes through the new, flat-rate tax. The changes were approved by the last Legislature, specifically aimed to take effect Jan. 1, 2008.
And taxes could be cut again late next year or early 2009. The Republican majorities in the Utah House and Senate have already said they want to authorize additional tax cuts that could approach $100 million during the 2008 Legislature, which starts in three weeks.
Gov. Jon Huntsman Jr., who will seek re-election in 2008, made a campaign promise in 2004 that he would reform Utah's tax system. He's made some progress with what he described as "a very good tax package," and it's maybe more than skeptics believed possible when he first came into office in 2005.
"I believe we get a passing grade" on tax reform, Huntsman told the Deseret Morning News. While he may not have gotten all that he wanted (at one point he suggested in vain that the current 5 percent corporate income tax be phased out), Huntsman believes his flat-rate income tax, a general sales tax cut and especially the reduction of the sales tax on food have earned the state positive reviews around the country and helped the state rank high among business groups and the financial media for its business climate.
Should he win a second term, Huntsman said his "main tax goal" is to finish removing all of the sales tax from food. Before then, however, he also wants to try to help people with escalating health-care costs by giving self-employed people the same personal income tax break that corporate-employed people currently receive.
Doing so could cost between $40 million and $50 million, but he wants to start the process this year. To help kick-start it, he has included $30 million in his proposed budget for health-care reform.
While he didn't initially call the money a tax break, he now sees it "as a tax cut to many Utahns, and there is real interest in the Legislature to do something on health care."
Huntsman doesn't see much more to be done in an overall attempt to give business more tax breaks — there may be some targeted efforts ahead — and "there is not much interest" in trying to extend the sales tax into service areas, either, he said.
Recent comments
Removing all the exemptions creates a 60% tax increase for some,…
What a mess | Jan. 26, 2008 at 12:00 p.m.
I live in Davis County, but I'm originally from the wacky Commonwealth…
Former Massachusetts resident | Dec. 30, 2007 at 9:41 p.m.
To: I will remember/comment #1
You need to vote against everyone…
Wake up | Dec. 30, 2007 at 10:20 a.m.
