Today is the 51st day of the session; nine days to go until adjournment sine die.
In the floor session today, House members voted to pass several big ticket tax bills which, if they become law, will serve to address the state's severe budget deficit. They are:
HB1741, HD1, SD1, CD1 RELATING TO THE CONVEYANCE TAX. This bill increases the conveyance tax rate for sales over $2 million as well as for second house purchases. The bill also reduces the distribution of portions of the Conveyance Tax transferred to the Rental Housing Trust Fund (30% to 25%) and the Natural Area Reserve Fund (25% to 20%). The bill would be effective on July 1, 2009 to June 30, 2012.
Fiscal impact: An increase of about $4 million a year, with $3 million redistributed to NARS and RHTF.
HB1747, HD1, SD1, CD1 RELATING TO TAXATION. This bill increases the income tax for high income brackets, to 12/31/15. It also increases the standard deduction and personal exemption amount beginning after December 31, 2010.
Fiscal impact: An increase of about $48.3 million per year. The increase in standard deduction and personal exemption will cost the state about $11 million per year when it kicks in.
HB1175, HD3, SD2, CD1 RELATING TO TAXATION. This bill increases the per cigarette tax to 13 cents beginning July 1, 2009, to 14 cents beginning July 1, 2010, and to 15 cents beginning on July 1, 2011.
Fiscal impact: An increase of $22.5 million in FY10, $24.2 million in FY11 and FY12, and $21.6 million in FY13 and in the out years.
HB895, HD2, SD2, CD1 RELATING TO TAX ON TOBACCO PRODUCTS OTHER THAN CIGARETTES. This bill increases the tobacco tax on tobacco products other than cigarettes and cigars, including smokeless tobacco, snuff, and pipe tobacco. The increase is a rise from 40% to 70% of the wholesale price beginning on September 30, 2009. It increases the tax on cigars from 40% to 50% on cigars beginning September 30, 2009. Little cigars would be taxed like cigarettes.
Fiscal impact: $3.5 million per year.
SB1111, SD1, HD1, CD1 RELATING TO TAXATION. This bill raises the transient accommodations tax by 1% (7.25% to 8.25%) beginning on 7/1/09 to 6/30/10, and another 1% (8.25% to 9.25%) beginning on 7/1/10. Sunsets on 6/30/15.
Fiscal impact: An increase of $28 million in FY10, $60 million in FY11 - FY15.