Providing an excise tax on large employers for certain federal benefits paid to employees.

Session of 2026
HOUSE BILL No. 2432
By Representatives Meyer, Oropeza and S. Ruiz
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AN ACT concerning taxation; relating to excise tax; providing a tax on
large employers for certain federal benefits paid to employees.
Be it enacted by the Legislature of the State of Kansas:
Section 1. Sections 1 through 4, and amendments thereto, shall be
known and may be cited as the stop bad employers by zeroing out
subsidies act.
Sec. 2. (a) There is hereby imposed an excise tax on each large
employer equal to 100% of the qualified employee benefits received by an
employee of such employer for the taxable year.
(b) In the case of an employer that was not in existence throughout
the preceding calendar year, the determination of whether such employer is
a large employer shall be based on the average number of employees that
such employer is reasonably expected to employ on business days in the
current calendar year.
(c) Any reference in this section to an employer shall include a
reference to any predecessor of such employer.
(d) As used in this section:
(1) "Employee" means:
(A) Any full-time or part-time employee;
(B) any individual who is a full-time or part-time independent
contractor, including any employee of such independent contractor, and
provides services to the employer, unless:
(i) The individual is free from control and direction in connection
with the performance of the service, both under the contract for the
performance of service and in fact;
(ii) the service is performed outside the usual course of the business
of the employer; and
(iii) the individual is customarily engaged in an independently
established trade, occupation, profession or business of the same nature as
that involved in the service performed; or
(C) any individual who is a full-time or part-time joint employee, if
the employer possesses, reserves or exercises sufficient direct or indirect
control over the essential terms and conditions of employment of such
employee.
(2) "Large employer" means any employer who employed an average
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HB 2432 2
of at least 500 employees on business days during the preceding calendar
year.
(3) "Qualified employee benefits" means the sum of the qualified
federal benefits received by individuals who are employees of such
employer for such taxable year.
(4) "Qualified federal benefits" means any of the following:
(A) The dollar value of supplemental nutrition as provided in the food
and nutrition act of 2008, as amended, for which a household that includes
such employee received.
(B) The dollar value of meals for which such employee or dependents
of such employee received under the national school lunch program.
(C) The total amount of the monthly assistance benefits received
pursuant to the United States housing act of 1937, as amended, where such
employee resides for rental of a dwelling unit.
(D) The amount of payments made for medical assistance for such
employee or dependents of such employee under a qualifying state
medicaid plan under title XIX of the social security act.
Sec. 3. Any large employer is prohibited from making inquiries
regarding an applicant for employment or otherwise seeking information
about such applicant, including through the use of any form or application,
relating to whether such applicant receives qualified federal benefits.
Sec. 4. (a) The director of taxation shall administer this act. All tax
payments required pursuant to this act shall be made to the director and
accompanied by a tax return upon forms devised and furnished by the
director.
(b) Taxes levied and collected pursuant to section 2, and amendments
thereto, shall be remitted to the director of taxation. The director shall
remit all such tax revenue to the state treasurer in accordance with the
provisions of K.S.A. 75-4215, and amendments thereto. Upon receipt of
each such remittance, the state treasurer shall deposit the entire amount in
the state treasury and credit 100% to the state general fund.
Sec. 5. This act shall take effect and be in force from and after its
publication in the statute book.
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