While the governor has his preferences, lawmakers will have their own ideas to hash out. And that may include yet another income tax rate cut.
As part of his budget recommendation, Cox proposed nixing the state’s tax on Social Security benefits, estimated to cost the state about $143.8 million a year.
Currently, Utah households that receive Social Security and earn less than $75,000 can already qualify for a Social Security benefit tax credit. However, the governor’s proposal would help reduce income taxes for an estimated 150,000 more taxpayers — to the tune of about $950 a year for the average filer.
Cox said he supports totally repealing Utah’s tax on Social Security benefits as a tax cut “targeted to our seniors.” He also proposed using $2.1 million to expand the state’s child tax credit for families of up to four children.
However, Utah’s Republican legislative leaders aren’t fully committing to supporting Cox’s proposal. House Speaker Mike Schultz, R-Hooper, and Senate President Stuart Adams, R-Layton, said they’re supportive of reducing the Social Security tax on benefits at least partially, but they also said lawmakers will be considering other ideas.
“We want to provide tax cuts to every citizen, including those on Social Security,” Schultz said.
While it remains to be seen exactly what lawmakers will do, Schultz said, “I believe something will be done on Social Security. Whether it goes as what the governor wants, that’s yet to be determined.”
Schultz said that may entail yet another reduction to Utah’s income tax rate. That’s something Adams decisively said he’d like to see — in addition to expanding the Social Security tax credit. But that may mean perhaps not removing the tax on Social Security benefits entirely.
“I support trying to do both,” Adams said. He added that the income cap on the Social Security tax credit “might go from $75,000 to $100,000 or something,” though that depends on the budgeting process.
“We only have so much money, so we’ll start running the data and figuring it out,” Adams said. “But I support doing both, not just one.”
Read the full story at UtahNewsDispatch.com.
