Former KDP chair says governor's race is preventing tax reform, which must happen soon

07/11/2011 08:58 AM

Kentucky’s political leaders should start considering tax reforms immediately, former state representative and Kentucky Democratic Party chair Terry McBrayer told Pure Politics in a recent interview.

Failing to change Kentucky’s tax code will put Kentucky further behind other states who have modernized their tax system to keep up with a changing economy, McBrayer said.

McBrayer, a longtime Democratic politician and activist, says both legislative and executive branch leaders need to look at reforms like reducing the corporate income tax and consider including the sales taxes on services.

“Nobody’s really been willing to take a close and hard look at the other alternatives to our structure,” McBrayer told Pure Politics. “And we’ve got to take a more serious approach and we’ve got to do it like you we’re doing a constitutional convention. You’ve got to do with the brightest mind in the Commonwealth. From business to the universities and from the political side and sit the partisanship outside the door …”

While McBrayer’s scenario hasn’t ever been talked about in the General Assembly, many lawmakers, including Democratic state Rep. Jim Wayne of Louisville and Republican state Rep. Bill Farmer of Lexington, introduce tax reform bills every legislative session.

The Republican-controlled state Senate passed a bill last year that would have put Kentucky’s entire tax code up for a re-do by putting together a commission that would have included accountants, professors and others to write a new tax code that the General Assembly could vote up or down.

Republican Senate President David Williams pushed the bill, but it died in the Democratic-controlled state House when lawmakers were left off the commission.

Williams is the Republican nominee in the fall governor’s race, in which Democratic Gov. Steve Beshear is running for re-election.

In recent weeks, a few state senators have called for a second look at tax code reform and both Williams and Democratic state House Speaker Greg Stumbo have said the corporate income tax should be eliminated.

But last week, Beshear told Pure Politics again that tax reform during a recession was too tricky to get into and that he wouldn’t support any tax increases while governor.

McBrayer, a former gubernatorial candidate himself in the 1979 Democratic primary, says if tax reform is to happen, it has to come from the governor. He blamed the race between Williams, Beshear and Independent candidate Gatewood Galbraith for Beshear’s passive attitude toward tax reforms.

“And I think once we get this governor’s race out of the way, this year you will see a renewed effort to address things like that,” McBrayer said. “And we probably need to get the governor’s race behind us before we move and take a closer look at tax reform … “

Beshear’s chief argument against tax reform is that the words sound too good to be true and usually include raising taxes. But his fellow Democrat, McBrayer, said Beshear’s notion couldn’t be farther from the truth.

“Well everybody is afraid to say taxes go up or go down,” McBrayer said. “ … Tax reform does not mean increase in taxes, it means a shifting of the burden from one group to another.”

-Written by Kenny Colston, interview by Ryan Alessi, video by Greg Pursifull


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