The 2015 Legislative Session wrapped up Friday, making it the longest session in history going 118 days. This session will be remembered for the bitter fight between closing a $400 million budget hole and maintaining the Governor's "March to Zero" income tax plan passed in 2012. The final tax bills passed with only republican votes, by several who had signed a "No Tax Pledge" during the last election. A bill to increase taxes was a hard fought battle within the Republican Party, but was necessary to avoid deep budget cuts as had been threatened by the Governor earlier in the week.

After cutting as much as thought possible from the Fiscal Year 2016 budget and enacting a 2% across the board cut, a hole of more than $400 million remained. Many tax plans were discussed, including plans that made significant changes to the pass-through business income and reduction of income tax rates. However, the final plan made only a minor change to business income and instead increased state sales tax. Significant legislative policy discussions also took place around sun setting sales tax exemptions, a reduction in the sales tax rate on food and imposition of a local property tax lid. In the end, the tax plan passed included the property tax lid for local governments which prohibits cities and counties from adopting, absent mandatory elections, portions of their budgets funded with revenues from certain property tax increases. The House and Senate Tax Committees will review all sales tax exemptions next session, but none will have an automatic sunset. And, the Legislature will also look at the sales tax reduction on food during the 2016 Session if revenues are adequate.
 

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