Bluegrass Institute responds to governor’s decision to sign 2024 income tax rate reduction

For Immediate Release: Friday, February 17, 2023 Contact: Jim Waters @ (270) 320-4376

The Bluegrass Institute for Public Policy Solutions issued the following statement in response to Gov. Andy Beshear’s decision to sign House Bill 1 (HB 1) into law today. HB 1 reduces the state’s individual income tax rate from 4.5% to 4%, effective Jan. 1, 2024. The bill passed the Kentucky House of Representatives and Senate by votes of 79-19 and 30-5, respectively.

The Bluegrass Institute applauds the governor’s decision to further reduce Kentuckians’ overall tax burden and improve the commonwealth’s economic  competitiveness by signing HB 1 into law.

Kentucky has taken another big step forward in placing the Bluegrass State and its citizens on a path toward a more prosperous future.

HB 1 follows the conditions established by legislation during last year’s General Assembly triggering reductions in the income tax rate if revenues for the previous fiscal year exceed expenses, cover the cost of the tax-rate reduction and maintain a Budget Reserve Trust Fund balance of at least 10% of General Fund revenues.

“Some will claim that Gov. Beshear signed this bill because of the political climate during an election year. Perhaps, but the Bluegrass Institute’s focus is on the policy,” Waters said. “Election year or not, reducing the income tax rate is good policy. It will help grow our commonwealth’s population and prosperity by allowing Kentuckians to keep more of their hard-earned dollars while helping ensure that state government lives within its means.”

Last year, the General Assembly approved lowering this year’s rate from 5% to 4.5%. Kentucky was one of 10 states which lowered their individual income tax rates for 2023.

For more information or comment, please contact Bluegrass Institute president and CEO Jim Waters at (270) 320-4376 or jwaters@freedomkentucky.com.