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Kansas lawmakers concluded the longest legislative session in state history Friday night by approving a slate of regressive tax hikes that will balance the state’s budget by targeting low-income workers and their families.
More than half of the $384 million in new revenue expected from the tax hike will come from cigarette taxes and sales taxes, two policies described as “regressive” because they fall more heavily on lower-income taxpayers than on the wealthy. Even though everyone who shops will pay the new 6.5 percent sales tax rate – up from 6.15 percent in previous years, and the 8th-highest of any state according to the Tax Foundation – the move is regressive because poorer shoppers already have to stretch each dollar farther than their more flush counterparts.
The state offers a limited tax credit for grocery purchases to low-income families that slightly offsets the unevenness of the sales tax impact. But that credit is capped at $500 and cannot be claimed by families earning over $30,615 a year. A family of four that earns too much to qualify for the credit will pay nearly $700 a year in sales tax payments on their food, according to a Kansas City Star analysis of Friday’s bill that found the bulk of the burden falls on people making less than $50,000 annually.
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