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Session of 2025
SENATE BILL No. 103
By Committee on Assessment and Taxation
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AN ACT concerning taxation; relating to income tax; authorizing cities
and counties to propose an earnings tax for ballot question and to levy
such tax upon nonresidents of the city or county if approved by the
electors of a city or county; requiring resubmission of the question, if
approved, to the electors every 10 years thereafter; allowing certain
credits and exemptions against such tax; providing for the deduction by
public and private employers of such tax from employee earnings;
providing for revenue to be pledged for certain purposes; amending
K.S.A. 12-140 and K.S.A. 2024 Supp. 19-101a and repealing the
existing sections.
Be it enacted by the Legislature of the State of Kansas:
New Section 1. (a) Any city or county, respectively, is hereby
empowered and authorized in accordance with the provisions of this act to
levy an earnings tax upon all individuals that are not residents of the city
or county that are employed or working within such city or county.
(b) The rate of any earnings tax pursuant to subsection (a) shall not
exceed 1% per annum.
(c) (1) The revenue derived from the earnings tax authorized by this
act levied by a city shall be pledged for infrastructure purposes. At least
50% of the revenue derived from a city earnings tax authorized by this act
shall be credited in the budget of the city to reduce the amount of revenue
otherwise necessary to be derived from the ad valorem property tax.
(2) The revenue derived from the earnings tax authorized by this act
levied by a county shall be pledged for general county purposes. At least
50% of the revenue derived from a county earnings tax authorized by this
act shall be credited in the budget of the county to reduce the amount of
revenue otherwise necessary to be derived from the ad valorem property
tax.
(d) If any provision of this act or the application thereof to any person
or circumstance is held invalid, such invalidity shall not affect other
provisions or applications of this act that can be given effect without the
invalid provision or application, and to this end the provisions of this act
are severable.
New Sec. 2. As used in this act:
(a) "Act" means the provisions of sections 1 through 6, and
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amendments thereto.
(b) "Earnings tax" means a tax on the salaries, wages, commissions
and other compensation earned by nonresidents of the city or county
levying such tax, as applicable, for work done or services performed or
rendered in the city or county.
(c) "Salaries, wages, commissions and other compensation" does not
include contributions to any deferred compensation plans, including, but
not limited to, any salary reduction plans, cafeteria plans or any other
similar plans deferring the receipt of compensation by a resident or
nonresident if such contribution is not subject to Kansas state income tax
at the time such contribution is made.
New Sec. 3. (a) No city or county shall levy an earnings tax until the
governing body of such city or county shall first submit such proposition
to and receive the approval of a majority of the electors of the city or
county voting thereon at election specified by the city or county. Any city
or county proposing to adopt an earnings tax shall adopt an ordinance or
resolution, as applicable, giving notice of the city's or county's intention to
subject such proposition for approval by the electors in the manner
required by K.S.A. 25-105, and amendments thereto. The notice shall state
the time of the election, the rate of the tax and the purpose for which the
proceeds will be expended in accordance with section 1(c), and
amendments thereto. Every election held under this act shall be conducted
by the county election officer of the county in which the city is comprised,
in whole or in part, or the county election officer of the county, as
applicable.
(b) If a majority of the electors voting thereon at such election shall
approve the levying of such tax, the governing body of that city or county
shall provide by ordinance or resolution, respectively, the levy of the tax.
Any repeal of such tax, or any reduction or increase in the rate thereof,
within the limits of this act, shall be accomplished in the manner provided
for in this act for the adoption and approval of such tax, except that the
governing body of a city or county shall be required to submit such
question upon submission of a petition signed by the electors of such city
or county equal in number to not less than 10% of the electors of such city
or county. If a majority of the electors voting thereon at such election fail
to approve the proposition, it may be resubmitted under the conditions and
in the manner provided in this act for submission of the original
proposition.
(c) Any ordinance or resolution, as applicable, that has been adopted
to give notice of the intention of the governing body of the city or county
to submit the proposition of levying an earnings tax to the electors of the
city or county, respectively, shall contain provisions pledging the use of
the revenue to be received from such tax if such resolution is approved by
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the voters in accordance with the provisions of section 1(c), and
amendments thereto. Such description shall be consistent with that
contained in the notice of election required by subsection (a).
(d) In any city or county imposing an earnings tax pursuant to this
act, once every 10 years after the initial levy of the earnings tax by the city
or county, the question whether to continue to impose an earnings tax shall
be submitted to the respective electors in the same manner provided in this
act for the original proposition.
New Sec. 4. Any person exempt from the payment of state income
tax pursuant to K.S.A. 79-32,113, and amendments thereto, shall be
exempt from the payment of an earnings tax levied pursuant to this act.
New Sec. 5. The amount of earnings tax paid to another city with an
earnings tax by a nonresident individual shall be allowed as a credit
against the earnings tax of the city of such individual's residence. The
amount of earnings tax paid to another county with an earnings tax by a
nonresident individual shall be allowed as a credit against the earnings tax
of the county of such individual's residence.
New Sec. 6. (a) By ordinance or resolution, the city or county,
respectively, may provide for deductions and exemptions from salaries,
wages and commissions and may provide exemptions reducing the tax on
account of spouses and dependents.
(b) The earnings subject to earnings tax of any nonresident individual
when work is performed or rendered both within and without the city or
county may be ascertained by a formula set forth by ordinance of the city
or resolution of the county, as applicable.
(c) The state of Kansas and its political subdivisions shall deduct
from the earnings of their employees the amount of any city or county
earnings tax, as applicable, levied upon the income of the particular
employee and remit such amount to the city or county levying such tax.
The state of Kansas and its political subdivisions shall be entitled to deduct
and retain, of the total amount so collected to compensate such employer
for collecting the tax, a percentage as follows: 3% if such city or county
earnings tax is less than 1% of gross earnings; or 1.5% if such city or
county earnings tax is 1% of gross earnings.
(d) Any city or county levying an earnings tax is hereby authorized to
impose, by ordinance or resolution, respectively, upon employers within
the city or county the duty of collecting and remitting to the city or county,
as applicable, any tax that may be levied upon the earnings of employees
pursuant to this act and to prescribe penalties for failure to perform such
duty. If any such city or county should impose such duty on employers,
each such employer shall be entitled to deduct and retain 1.5% of the total
amount collected to compensate such employer for collecting such tax.
The governing body of any such city, by ordinance, or any such county, by
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resolution, may reduce, eliminate or reimpose, if eliminated, the fee
allowed to employers by this subsection.
(e) (1) All employers within the state, upon request as provided in
this subsection, shall submit to any city or county levying an earnings tax a
complete listing of all their employees who reside outside the territorial
limits or boundaries of the requesting city or county and their current
addresses according to the records of the employer. Any request shall be
made in writing and shall be mailed to the principal office of the employer.
If the employer is a corporation, the written request shall be made to the
registered agent of the corporation at its registered office. All written
requests provided for in this subsection shall be by registered or certified
mail. Such request may not be made more than once each year. This
subsection shall not apply to employers who deduct from the earnings of
their employees the amount of any city or county earnings tax levied upon
the income of the particular employee and remit the same to the city or
county levying such tax.
(2) No list of employees furnished to the city or county shall be used
for any purpose other than in connection with the collection of an earnings
tax. Such lists shall be treated as confidential records and, except in
accordance with a proper judicial order, shall not be disclosed by the city
or county. Such lists shall not be open to public inspection pursuant to the
Kansas open records act. The provisions of this subsection providing for
the confidentiality of records shall expire on July 1, 2030, unless the
legislature reviews and continues such provisions in accordance with
K.S.A. 45-229, and amendments thereto, prior to July 1, 2030.
Sec. 7. K.S.A. 12-140 is hereby amended to read as follows: 12-140.
Except as otherwise specifically authorized by K.S.A. 12-1,101 to through
12-1,109, and amendments thereto, and sections 1 through 6, and
amendments thereto, no city shall have power to levy and collect taxes on
incomes from whatever source derived.
Sec. 8. K.S.A. 2024 Supp. 19-101a is hereby amended to read as
follows: 19-101a. (a) The board of county commissioners may transact all
county business and perform all powers of local legislation and
administration it deems appropriate, subject only to the following
limitations, restrictions or prohibitions:
(1) Counties shall be subject to all acts of the legislature which apply
uniformly to all counties.
(2) Counties may not affect the courts located therein.
(3) Counties shall be subject to acts of the legislature prescribing
limits of indebtedness.
(4) In the exercise of powers of local legislation and administration
authorized under provisions of this section, the home rule power conferred
on cities to determine their local affairs and government shall not be
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superseded or impaired without the consent of the governing body of each
city within a county which may be affected.
(5) Counties may not legislate on social welfare administered under
state law enacted pursuant to or in conformity with public law No. 271 –
74th congress, or amendments thereof.
(6) Counties shall be subject to all acts of the legislature concerning
elections, election commissioners and officers and their duties as such
officers and the election of county officers.
(7) Counties shall be subject to the limitations and prohibitions
imposed under K.S.A. 12-187 through 12-195, and amendments thereto,
prescribing limitations upon the levy of retailers' sales taxes by counties.
(8) Counties may not exempt from or effect changes in statutes made
nonuniform in application solely by reason of authorizing exceptions for
counties having adopted a charter for county government.
(9) No county may levy ad valorem taxes under the authority of this
section upon real property located within any redevelopment project area
established under the authority of K.S.A. 12-1772, and amendments
thereto, unless the resolution authorizing the same specifically authorized
a portion of the proceeds of such levy to be used to pay the principal of
and interest upon bonds issued by a city under the authority of K.S.A. 12-
1774, and amendments thereto.
(10) Counties shall have no power under this section to exempt from
any statute authorizing or requiring the levy of taxes and providing
substitute and additional provisions on the same subject, unless the
resolution authorizing the same specifically provides for a portion of the
proceeds of such levy to be used to pay a portion of the principal and
interest on bonds issued by cities under the authority of K.S.A. 12-1774,
and amendments thereto.
(11) Counties may not exempt from or effect changes in the
provisions of K.S.A. 19-4601 through 19-4625, and amendments thereto.
(12) Except as otherwise specifically authorized by K.S.A. 12-1,101
through 12-1,109, and amendments thereto, and sections 1 through 6, and
amendments thereto, counties may not levy and collect taxes on incomes
from whatever source derived.
(13) Counties may not exempt from or effect changes in K.S.A. 19-
430, and amendments thereto.
(14) Counties may not exempt from or effect changes in K.S.A. 19-
302, 19-502b, 19-503, 19-805 or 19-1202, and amendments thereto.
(15) Counties may not exempt from or effect changes in K.S.A. 19-
15,139, 19-15,140 and 19-15,141, and amendments thereto.
(16) Counties may not exempt from or effect changes in the
provisions of K.S.A. 12-1223, 12-1225, 12-1225a, 12-1225b, 12-1225c
and 12-1226, and amendments thereto, or the provisions of K.S.A. 12-
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1260 through 12-1270 and 12-1276, and amendments thereto.
(17) Counties may not exempt from or effect changes in the
provisions of K.S.A. 19-211, and amendments thereto.
(18) Counties may not exempt from or effect changes in the
provisions of K.S.A. 19-4001 through 19-4015, and amendments thereto.
(19) Counties may not regulate the production or drilling of any oil or
gas well in any manner which would result in the duplication of regulation
by the state corporation commission and the Kansas department of health
and environment pursuant to chapter 55 and chapter 65 of the Kansas
Statutes Annotated, and amendments thereto, and any rules and regulations
adopted pursuant thereto. Counties may not require any license or permit
for the drilling or production of oil and gas wells. Counties may not
impose any fee or charge for the drilling or production of any oil or gas
well.
(20) Counties may not exempt from or effect changes in K.S.A. 79-
41a04, and amendments thereto.
(21) Counties may not exempt from or effect changes in K.S.A. 79-
1611, and amendments thereto.
(22) Counties may not exempt from or effect changes in K.S.A. 79-
1494, and amendments thereto.
(23) Counties may not exempt from or effect changes in K.S.A. 19-
202(b), and amendments thereto.
(24) Counties may not exempt from or effect changes in K.S.A. 19-
204(b), and amendments thereto.
(25) Counties may not levy or impose an excise, severance or any
other tax in the nature of an excise tax upon the physical severance and
production of any mineral or other material from the earth or water.
(26) Counties may not exempt from or effect changes in K.S.A. 79-
2017 or 79-2101, and amendments thereto.
(27) Counties may not exempt from or effect changes in K.S.A. 2-
3302, 2-3305, 2-3307, 2-3318, 17-5904, 17-5908, 47-1219, 65-171d, 65-
1,178 through 65-1,199, 65-3001 through 65-3028, and amendments
thereto.
(28) Counties may not exempt from or effect changes in K.S.A. 80-
121, and amendments thereto.
(29) Counties may not exempt from or effect changes in K.S.A. 19-
228, and amendments thereto.
(30) Counties may not exempt from or effect changes in the Kansas
911 act.
(31) Counties may not exempt from or effect changes in K.S.A. 26-
601, and amendments thereto.
(32) (A) Counties may not exempt from or effect changes in the
Kansas liquor control act except as provided by paragraph (B).
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(B) Counties may adopt resolutions which are not in conflict with the
Kansas liquor control act.
(33) (A) Counties may not exempt from or effect changes in the
Kansas cereal malt beverage act except as provided by paragraph (B).
(B) Counties may adopt resolutions which are not in conflict with the
Kansas cereal malt beverage act.
(34) Counties may not exempt from or effect changes in the Kansas
lottery act.
(35) Counties may not exempt from or effect changes in the Kansas
expanded lottery act.
(36) Counties may neither exempt from nor effect changes to the
eminent domain procedure act.
(37) Any county granted authority pursuant to the provisions of
K.S.A. 19-5001 through 19-5005, and amendments thereto, shall be
subject to the limitations and prohibitions imposed under K.S.A. 19-5001
through 19-5005, and amendments thereto.
(38) Except as otherwise specifically authorized by K.S.A. 19-5001
through 19-5005, and amendments thereto, counties may not exercise any
authority granted pursuant to K.S.A. 19-5001 through 19-5005, and
amendments thereto, including the imposition or levy of any retailers' sales
tax.
(39) Counties may not exempt from or effect changes in K.S.A. 65-
201 and 65-202(a), (b), (d), (e) and (f), and amendments thereto.
(b) Counties shall apply the powers of local legislation granted in
subsection (a) by resolution of the board of county commissioners. If no
statutory authority exists for such local legislation other than that set forth
in subsection (a) and the local legislation proposed under the authority of
such subsection is not contrary to any act of the legislature, such local
legislation shall become effective upon passage of a resolution of the
board and publication in the official county newspaper. If the legislation
proposed by the board under authority of subsection (a) is contrary to an
act of the legislature which is applicable to the particular county but not
uniformly applicable to all counties, such legislation shall become
effective by passage of a charter resolution in the manner provided in
K.S.A. 19-101b, and amendments thereto.
(c) Any resolution adopted by a county which conflicts with the
restrictions in subsection (a) is null and void.
Sec. 9. K.S.A. 12-140 and K.S.A. 2024 Supp. 19-101a are hereby
repealed.
Sec. 10. This act shall take effect and be in force from and after its
publication in the statute book.
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