Brief(1)
S.B. 2, as amended, would
reduce the state sales tax rate on food for human consumption from 4.9
percent to 3.3 percent on June 1, 1999; and to 2.2 percent on June 1, 2001.
The state and local sales taxes on such purchases would be totally repealed
on June 1, 2002. "Food for human consumption" would be defined to exclude
meals prepared for immediate consumption on or off the premises of the
retailer.
The bill also would expand
the local sales tax authority of cities in Finney, Reno, Lyon, and Osage
counties for economic development or public infrastructure purposes. All
such cities would be granted additional authority of up to 0.75 percent,
but any tax imposed to the new authority would be required to sunset after
five years.
Russell County would be granted
similar additional sales tax authority for economic development or public
infrastructure purposes in the amount of exactly 0.5 percent. The county
would not be required to share the revenue from the tax imposed under this
new authority with the cities in Russell County.
Background
The
Kansas Legislative Research Department estimates the bill would impact
the SGF, SHF, LAVTRF, and CCRSF as follows:
| ($ in Thousands) | |||||
| FY 2000 | FY 2001 | FY 2002 | FY 2003 | FY 2004 | |
| SGF Initial Receipts | ($71,020) | ($73,861) | ($129,626) | ($244,658) | ($254,444) |
| SHF Quarter
Percent |
($3,818) | ($3,971) | ($6,969) | ($13,154) | ($13,680) |
| SHF Demand
Transfer |
($4,063) | ($5,580) | ($8,824) | ($16,468) | ($19,222) |
| SHF Total Impact | ($7,881) | ($9,551) | ($15,793) | ($29,622) | ($32,902) |
| LAVTRF Demand
Transfer |
($645) | ($1,959) | ($3,161) | ($5,243) | ($7,926) |
| CCRSF Demand
Transfer |
$0 | ($1,002) | ($2,045) | ($2,872) | ($5,283) |
| SGF Net After
All Transfers |
($58,431) | ($55,769) | ($99,803) | ($190,453) | ($189,111) |
The original bill, which
was supported by Garden City, would have applied only to cities in Finney
County. The Senate Assessment and Taxation Committee amended the bill to
be effective upon publication in the Kansas Register at the request
of Garden City, whose representative indicated that the city hoped to hold
a sales tax election in April. The Senate Assessment and Taxation Committee
further amended the bill to add the provisions relative to Russell County
and to cities in Reno County. The Senate Committee of the Whole added the
provisions relative to cities in Lyon and Osage counties. The House Committee
of the Whole added the provisions relating to sales taxes on food for human
consumption.
Under current law, cities and counties have general sales tax authority to levy up to 1 percent. Additional authority of up to 1 percent is granted if revenues are earmarked for "health care" purposes. A number of other cities and counties have been granted additional authority for construction of jails, courthouses, and law enforcement centers; and for economic development or public infrastructure purposes.
1. *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.ink.org/public/legislative/bill_search.html.