The bill proposes comprehensive changes to the taxation of business and financial institution income in Kansas, primarily by introducing a single sales factor for apportioning business income and a receipts factor for financial institution income. It establishes a three-factor test for manufacturers selling alcoholic liquor and mandates deductions from income based on these factors. The bill aims to lower corporate income tax rates, with new rates set to take effect in 2028, contingent on the certification of corporate income tax revenues by the director of the budget. Key amendments include adjustments to the corporate income tax rate based on actual revenues, a deferred tax impact deduction for publicly traded companies, and clarifications of definitions related to business income and financial organizations.

Additionally, the bill outlines specific provisions for railroads and interstate motor carriers regarding the apportionment of business income for tax years before January 1, 2027, and modifies the apportionment method for all businesses starting in 2027 to utilize the sales factor. It introduces a multistate tax compact to promote uniformity in tax systems and establishes a multistate tax commission to oversee tax law administration. The commission will have the authority to conduct audits, hold public hearings, and resolve disputes through arbitration. The bill also includes various amendments to existing tax laws, defining key terms and clarifying income allocation for taxpayers with business activities in multiple states, ultimately aiming to streamline tax processes and enhance cooperation among states.

Statutes affected:
As introduced: 79-1129, 79-3271, 79-3279, 79-3287, 79-32
As Amended by House Committee: 79-1129, 79-3271, 79-3279, 79-3287, 79-32
{As Amended by House Committee of the Whole}: 79-1129, 79-3271, 79-3279, 79-3287, 79-32, 79-4301