SESSION OF 2024
SUPPLEMENTAL NOTE ON HOUSE SUBSTITUTE FOR
SENATE BILL NO. 300
As Amended by House Committee of the Whole
Brief*
House Sub. for SB 300, as amended, would make
various changes to income, sales, and property tax law.
Specifically, the bill would:
●Restructure individual income tax brackets with
reduced tax rates;
●Exempt Social Security income from the individual
income tax;
●Increase the standard deduction and personal
exemption amounts and provide for future
increases by a cost-of-living adjustment;
●Reduce privilege tax rates;
●Reinstate the transfer from the State General Fund
(SGF) to the Special City and County Highway
Fund and abolish the Local Ad Valorem Tax
Reduction Fund and County and City Revenue
Sharing Fund;
●Increase the amount of the appraised value of
residential property exempt from the statewide
uniform school finance levy and reduce the mill
levy; and
●Accelerate the elimination of the state sales and
compensating use tax rate on food and food
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*Supplemental notes are prepared by the Legislative Research
Department and do not express legislative intent. The supplemental
note and fiscal note for this bill may be accessed on the Internet at
http://www.kslegislature.org ingredients and the associated disposition of
revenue changes.
Individual Income Tax Brackets and Rates
The bill would restructure the Kansas individual income
tax brackets, beginning in tax year 2024. For married
individuals filing jointly, taxable income of $0 to $14,000
would be taxed at 0.0 percent, taxable income from $14,001
to $60,000 would be taxed at 5.2 percent, and taxable income
of $60,001 and above would be taxed at 5.65 percent.
For all other filers, taxable income of $0 to $7,000 would
be taxed at 0.0 percent, taxable income from $7,001 to
$30,000 would be taxed at 5.2 percent, and taxable income of
$30,001 and above would be taxed at 5.65 percent.
Social Security Benefit Exemption
Beginning in tax year 2024, all Social Security benefits
would be exempt from Kansas income tax.
Standard Deduction and Personal Exemption Amounts
Increase and Cost-of-living Adjustments
The bill would increase the standard deduction amounts
from $3,500 to $3,605 for single filing status, $8,000 to
$8,240 for married filing status, and $6,000 to $6,180 for
head of household filing status for tax year 2024. These
amounts would be further increased by the cost-of-living
adjustment determined under Section 1(f)(3) of the Internal
Revenue Code for tax years 2025 and 2026.
The bill would increase the personal exemption amount
from $2,250 to $2,320 in tax year 2024 and provide for
personal exemption amounts to be increased by the cost-of-
living adjustment determined under Section 1(f)(3) of the
Internal Revenue Code for tax years 2025 and 2026.
2- 300 The increase and cost-of-living adjustments to the
personal exemption amounts would also apply to the
additional personal exemption amount for veterans who are
100.0 percent permanently disabled.
Financial Institutions Privilege Tax Rate Changes
The bill would reduce the privilege tax rates applied to
financial institutions:
●For banks, the normal tax rate would be reduced
from 2.25 percent to 1.63 percent for tax year 2025
and all years thereafter.
●For trust companies and savings and loan
associations, the normal tax rate would be reduced
from 2.25 percent to 1.61 percent for tax year 2025
and all years thereafter.
[Note: The surtaxes on financial institutions would not be
affected by the bill.]
Local Government Transfers
The bill would reinstate, effective for FY 2025, the
transfer from the SGF to the Special City and County
Highway Fund based on the SGF receipts from motor carrier
property taxes and commercial vehicle fees. [Note: This
transfer is scheduled to resume in FY 2026 under current
law.]
The bill would abolish the Local Ad Valorem Tax
Reduction Fund and County and City Revenue Sharing Fund
and eliminate statutory transfers from the SGF to these funds.
School Finance Levy Residential Exemption
The bill would increase, beginning in tax year 2024, the
amount of residential property exempt from the statewide
uniform school finance levy to $100,000 of appraised value.
3- 300 The bill would discontinue the formula to increase the
amount of the exemption based upon the statewide average
increase in residential valuation over the preceding ten years.
The bill would reduce the uniform school finance levy
from 20 mills to 18 mills in tax year 2024.
The bill would require a demand transfer be made from
the SGF to the School Finance Fund in the amount of any
reduction to the School Finance Fund attributable to the
residential exemption in excess of $42,049 and the mill levy
below 20 mills, as certified by the Director of the Budget.
Food Sales Tax Changes
The bill would accelerate the elimination of the state
sales and compensating use tax rate on food and food
ingredients from January 1, 2025, to July 1, 2024.
The bill would accelerate the raise in the percentage of
sales tax revenue distributed to the State Highway Fund to
18.0 percent of sales and use tax receipts beginning July 1,
2024, rather than beginning on January 1, 2025.
Background
The bill was introduced by the Senate Committee on
Taxation at the request of Senator Blasi and, as introduced,
concerned privilege tax rates. The House Committee on
Taxation removed the contents of the bill and inserted the
amended contents of HB 2844, the background of which
follows below.
HB 2844
HB 2844 was introduced by the House Committee on
Taxation at the request of Representative A. Smith.
4- 300 House Committee on Taxation
In the House Committee hearing, proponent testimony
was provided by representatives of the Kansas Chamber,
Kansas Farm Bureau, Kansas Livestock Association, and
Kansas Policy Institute. The proponents generally stated the
bill would provided broad-based tax relief and represented a
compromise of various other tax plans.
Written-only proponent testimony was provided by
representatives of Kansas Association of Realtors, Kansas
Bankers Association, and National Federation of Independent
Business-Kansas.
Neutral testimony was provided by representatives of
the Institute for Policy and Social Research at the University
of Kansas and the Kansas National Education Association.
Written-only neutral testimony was provided by
representatives of the Kansas Association of Counties and
Kansas Association of School Boards.
No other testimony was provided.
The House Committee amended the bill to insert the
provision reinstating the transfer to the Special City and
County Highway Fund.
House Committee of the Whole
The House Committee of the Whole amended the bill to:
●Exempt all Social Security benefits from the
individual income tax;
●Increase the amount of the appraised value of
residential property exempt from the statewide
uniform 20-mill school finance levy to $100,000
5- 300 and eliminate the provision providing for future
increases to the exempt amount;
●Require a demand transfer to the School Finance
Fund; and
●Accelerate the elimination of state sales and
compensating use tax on food and food ingredients
and the associated disposition of revenue changes.
Fiscal Information
A revised fiscal note on the amended bill was not
immediately available.
Taxation; income tax; property tax; rates; brackets; Social Security benefits; standard
deduction; personal exemption; privilege tax; residential exemption; mill levy; Special
City and County Highway Fund; Local Ad Valorem Tax Reduction Fund; food sales
tax
6- 300