LITTLE ROCK -- Arkansas Senate President Jonathan Dismang said Wednesday he hopes to bring Gov. Asa Hutchinson's middle-class income tax cut proposal before lawmakers as soon as next week.
Dismang filed the language for the legislation outlining Hutchinson's tax cut plan. He said the legislation mirrors Hutchinson's campaign promise to cut taxes for the middle class, with the reduction taking effect Jan. 1, 2016. The three-page measure would cut income taxes by 1 percent for those making between $21,000 and $75,000 a year.
Revenue officials said the cut would cost the state $33.7 million for the fiscal year that begins July 1, and $102.1 million when fully implemented the following year. Hutchinson has estimated about 500,000 residents would benefit from the cut.
Hutchinson, a Republican, was sworn in Tuesday as Arkansas' 46th governor and has called the tax cut measure his top priority for the legislative session.
"I think there's tremendous support for it among the people of Arkansas. That's what they voted for me to do and what we intend to accomplish," Hutchinson told reporters.
Dismang, R-Beebe, predicted the measure would pass easily in the Republican-led Legislature.
"I think there will be broad-based support," Dismang said. "This is a tax cut that helps middle-class working families in the state, and I think that's something to be supported by members, regardless of party."
House Speaker Jeremy Gillam, who is co-sponsoring the legislation, said backing for the cut will likely come in his chamber, too.
"At this time, right now, I do expect strong support for the concept," Gillam, R-Judsonia, said. "The members probably are just now getting the chance to read the language, so we're going to wait and see how that goes."
The proposal would reduce the income tax rate from 7 percent to 6 percent for those making between $35,100 and $75,000 a year, and from 6 percent to 5 percent for those making between $21,000 and $35,099.
Hutchinson announced late Wednesday that his plan includes delaying portions of an income tax cut lawmakers approved two years ago. He said the delay offset the $50 million cost of his tax cut plan for the coming fiscal year. The possibility of delaying tax cuts already approved faces opposition from some Republican lawmakers.
The legislation also adjusts the income tax brackets for those making between $75,001 and $80,000. Hutchinson's office said in a statement that the adjustment would prevent those making a small amount above $75,000 from seeing a significantly higher tax liability.
Democrats in the Legislature have said they want more details about Hutchinson's budget and how he'll pay for the cuts before considering the measure. They've also said they would prefer him to announce his plans for the state's compromise Medicaid expansion before taking up the bill.
Hutchinson has said he'll address the expansion's future in a speech next week.
Associated Press writer Nomaan Merchant contributed to this report.
State Desk on 01/15/2015