Taxpayers concerned about paying as much as 40% more for their vehicle-based tax this year while navigating rapidly rising prices due to inflation can breathe a sigh of relief now that Gov. Andy Beshear has taken action to address this hated levy, as bills moving through the legislature were also set to do.

Beshear on Wednesday issued an executive order freezing the taxable value of motor vehicles at their 2020 levels. He also proposed temporarily reducing the state’s sales tax from 6% to 5% for the next fiscal year, beginning July 1.

The Bluegrass Institute commends the governor’s recent interest in meaningful tax reform and encourages him to lead in reducing Kentuckians’ high overall tax burdens by supporting policies allowing taxpayers to permanently keep more of their hard-earned dollars in addition to the temporary relief his executive order provides.

However, we take issue with the governor’s claim on Wednesday that reducing Kentucky’s income tax rates “don’t benefit out economy.” States like Indiana and North Carolina, with whom Kentucky used to be more economically competitive, are enjoying comparatively bustling economies by gradually changing the focus of their tax policy to consumption instead of income, savings and retirement.

We urge Kentucky lawmakers to move forward with comprehensive pro-growth tax policy which favors economic freedom rather than progressive redistribution and sets our state’s course toward greater competitiveness and increased opportunities for our fellow citizens.