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{As Amended by House Committee of the Whole}
As Amended by House Committee
Session of 2025
HOUSE BILL No. 2318
By Committee on Taxation
Requested by Eric Stafford on behalf of the Kansas Chamber of Commerce
2-6
AN ACT concerning taxation; relating to income tax and privilege taxes ;
providing that future tax rate decreases be contingent on exceeding
revenue estimates {and retain a certain amount in the budget
stabilization fund}; amending K.S.A. 2024 Supp. 79-32,110 and
repealing the existing section.
Be it enacted by the Legislature of the State of Kansas:
New Section 1. (a) As used in this section:
(1) "Adjusted consumer price ratio" means the fiscal year consumer
price index divided by the base year consumer price index.
(2) "Adjusted general revenue fund collections" means actual tax
receipt revenues to the state general fund {from the Kansas income tax
act and the privilege tax imposed upon any national banking
association, state bank, trust company or savings and loan association
pursuant to article 11 of chapter 79 of the Kansas Statutes Annotated,
and amendments thereto}.
(3) "Base year revenues" means actual tax receipt revenues to the
state general fund for fiscal year 2024 in the amount of $10,003,833,599
{$5,969,395,529 from the Kansas income tax act and the privilege tax
imposed upon any national banking association, state bank, trust
company or savings and loan association pursuant to article 11 of
chapter 79 of the Kansas Statutes Annotated, and amendments
thereto}.
(4) "Base year consumer price index" means a 12-month average of
the not seasonally adjusted consumer price index for all urban consumers
for fiscal year 2024.
(5) "Excess fiscal year general revenue fund collections" means the
positive difference from subtracting the inflation adjusted base year
revenues from the adjusted general revenue fund collections from the
immediately preceding fiscal year.
(6) "Fiscal year consumer price index" means a 12-month average of
the not seasonally adjusted consumer price index for all urban consumers
for the immediately preceding fiscal year.
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(7) "Inflation adjusted base year revenues" means the base year
revenues multiplied by the adjusted consumer price ratio.
(b) Commencing on August 15, 2025, and every August 15 thereafter,
the director of the budget, in consultation with the director of legislative
research, shall determine whether the total fiscal year adjusted general
revenue fund collections from the immediately preceding fiscal year are in
excess of the inflation adjusted base year revenues {and if the amount of
moneys in the budget stabilization fund established pursuant to K.S.A.
75-6706, and amendments thereto, is equal to or exceeds 20% of the
prior fiscal year's state tax receipt revenues to the state general fund} .
If the total fiscal year adjusted general revenue fund collections from the
immediately preceding fiscal year are in excess of the inflation adjusted
base year revenues {and the amount of moneys in the budget
stabilization fund is equal to or exceeds 20% of the prior fiscal year's
state tax receipt revenues to the state general fund} , the director of the
budget shall certify to the secretary of revenue the existence of such excess
and the amount of the excess.
(c) In the event that the secretary of revenue certifies that the adjusted
general revenue fund collections from the immediately preceding fiscal
year are in excess of the inflation adjusted base year revenues {and the
amount of moneys in the budget stabilization fund is equal to or
exceeds 20% of the prior fiscal year's state tax receipt revenues to the
state general fund} , the secretary shall calculate and publish the income
tax and privilege tax rate reduction as a result of the excess. In calculating
the income tax rate reduction, the excess fiscal year general revenue fund
collections shall be computed that would result in the reduction of the
income tax rates pursuant to subsection (d) in an amount approximately
equal to the rate reductions down to the nearest 0.01% to go into effect for
the next tax year. In calculating the privilege tax rate reduction
pursuant to subsection (d), the reduction shall be a corresponding rate
reduction that is equal to the total percentage adjustment to the
corporate income tax. Such rate reductions shall remain in effect unless
further reduced pursuant to this section. The income tax brackets and
taxable income thresholds prescribed in K.S.A. 79-32,110(a), and
amendments thereto, shall be adjusted to reflect the changes in income tax
rates.
(d) The secretary shall first compute the reduction of the income tax
rates pursuant to K.S.A. 79-32,110(a), and amendments thereto, that
decreases proportionally all tax rates in effect. Once the lower income tax
rate is decreased to 4.5% {4%}, there shall be no further reductions to the
lower income tax rate and further reductions shall only be applied to
reduce the higher income tax rate in effect. Upon the higher income tax
rate being decreased to 4.5% {4%} , no further reductions shall occur to
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K.S.A. 79-32,110(a), and amendments thereto. The secretary shall then
compute decreases to:
(1) The surtax imposed pursuant to K.S.A. 79-32,110(c), and
amendments thereto. The surtax shall be decreased until the combined
normal and surtax rates equal 4.5% {4%} that are imposed pursuant to
K.S.A. 79-32,110(c), and amendments thereto. Once the combined normal
and surtax rates pursuant to K.S.A. 79-32,110(a), and amendments thereto,
equal 4.5% {4%}, no further reductions shall occur;
(2) the normal tax imposed pursuant to K.S.A. 79-1107, and
amendments thereto. The normal tax shall be decreased until the
combined normal and surtax rates equal 2.82% {2.6%} that are
imposed pursuant to K.S.A. 79-1107, and amendments thereto. Once
the combined normal and surtax rates pursuant to K.S.A. 79-1107,
and amendments thereto, equal 2.82% {2.6%}, no further reductions
shall occur; and
(3) the normal tax imposed pursuant to K.S.A. 79-1108, and
amendments thereto. The normal tax shall be decreased until the
combined normal and surtax rates equal 2.90% {2.62%} that are
imposed pursuant to K.S.A. 79-1108, and amendments thereto. Once
the combined normal and surtax rates pursuant to K.S.A. 79-1108,
and amendments thereto, equal 2.90% {2.62%}, no further reductions
shall occur.
Sec. 2. K.S.A. 2024 Supp. 79-32,110 is hereby amended to read as
follows: 79-32,110. (a) Resident individuals. Except as otherwise provided
by K.S.A. 79-3220(a), and amendments thereto, a tax is hereby imposed
upon the Kansas taxable income of every resident individual, which tax
shall be computed in accordance with the following tax schedules unless
otherwise modified pursuant to section 1, and amendments thereto:
(1) Married individuals filing joint returns.
(A) For tax years 2018 through 2023:
If the taxable income is: The tax is:
Not over $30,000........................................... 3.1% of Kansas taxable
income
Over $30,000 but not over $60,000............... $930 plus 5.25% of excess
over $30,000
Over $60,000..................................................$2,505 plus 5.7% of excess
over $60,000
(B) For tax year 2024, and all tax years thereafter:
If the taxable income is: The tax is:
Not over $46,000........................................... 5.2% of Kansas taxable
income
Over $46,000..................................................$2,392 plus 5.58% of excess
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over $46,000
(2) All other individuals.
(A) For tax years 2018 through 2023:
If the taxable income is: The tax is:
Not over $15,000........................................... 3.1% of Kansas taxable
income
Over $15,000 but not over $30,000............... $465 plus 5.25% of excess
over $15,000
Over $30,000..................................................$1,252.50 plus 5.7% of
excess over $30,000
(B) For tax year 2024, and all tax years thereafter:
If the taxable income is: The tax is:
Not over $23,000........................................... 5.2% of Kansas taxable
income
Over $23,000..................................................$1,196 plus 5.58% of excess
over $23,000
(b) Nonresident individuals. A tax is hereby imposed upon the Kansas
taxable income of every nonresident individual, which tax shall be an
amount equal to the tax computed under subsection (a) as if the
nonresident were a resident multiplied by the ratio of modified Kansas
source income to Kansas adjusted gross income.
(c) Corporations. A tax is hereby imposed upon the Kansas taxable
income of every corporation doing business within this state or deriving
income from sources within this state. Such tax shall consist of a normal
tax and a surtax and shall be computed as follows unless otherwise
modified pursuant to K.S.A. 2024 Supp. 74-50,321 or section 1, and
amendments thereto:
(1) The normal tax shall be in an amount equal to 4% of the Kansas
taxable income of such corporation; and
(2) the surtax shall be in an amount equal to 3% of the Kansas taxable
income of such corporation in excess of $50,000.
(d) Fiduciaries. A tax is hereby imposed upon the Kansas taxable
income of estates and trusts at the rates provided in subsection (a)(2).
(e) Notwithstanding the provisions of subsections (a) and (b), for tax
years 2018 through 2023, married individuals filing joint returns with
taxable income of $5,000 or less , and all other individuals with taxable
income of $2,500 or less, shall have a tax liability of zero.
Sec. 3. K.S.A. 2024 Supp. 79-32,110 is hereby repealed.
Sec. 4. This act shall take effect and be in force from and after its
publication in the statute book.
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