The bill amends the Kansas income tax law to establish a mechanism for future tax rate decreases that are contingent upon exceeding revenue estimates. It introduces definitions for terms such as "adjusted consumer price ratio," "adjusted general revenue fund collections," and "excess fiscal year general revenue fund collections." Starting August 15, 2025, the director of the budget will assess whether the previous fiscal year's adjusted general revenue fund collections exceed inflation-adjusted base year revenues. If they do, the secretary of revenue will calculate and publish the corresponding income tax rate reduction, which will apply to the next tax year and remain in effect unless further adjustments are made.

Additionally, the bill modifies the existing tax brackets and rates for resident individuals, nonresident individuals, corporations, and fiduciaries. For tax year 2024 and beyond, the tax rates for married individuals filing jointly and other individuals will be adjusted, with the lower income tax rate set at 5.2% for certain income thresholds. The bill also repeals the previous section of K.S.A. 2024 Supp. 79-32,110, effectively replacing it with the new provisions outlined in this act. The changes aim to create a more responsive tax system that adjusts based on actual revenue performance.

Statutes affected:
As introduced: 79-32