Governor Ernie Fletcher’s Communications Office
Governor Fletcher Signs Proclamation Calling General Assembly Into Special Session
FRANKFORT, Ky. – Governor Fletcher today signed a proclamation calling for a special session of the Kentucky General Assembly to begin tomorrow. The purpose of the session will be to provide tax relief for Kentucky’s small businesses and small business owners.
“Kentucky’s small businesses and small business owners are the backbone of the Kentucky economy,” said Governor Fletcher. “This legislation will help make our state more competitive in the world economy and will create jobs within our state.”
Governor Fletcher said about 70,000 business taxpayers – about 7 out of every 8 business taxpayers – will benefit from this legislation.
The bill will:
- Further strengthen small business in Kentucky;
- Enlarge the economic stimulus of the original tax modernization bill;
- And distribute back to small business owners part of the revenue which has increased as a result of a high level of economic growth over the last two years.
There are three key features to this legislation:
- The Governor will completely repeal the taxation of gross receipts and gross profits for companies with gross receipts and gross profits of $3 million or less this year.
- The legislation will preserve the reduction of the tax on corporate profits from 7 percent to 6 percent next year. This was an important point which will help attract and retain strong, profitable businesses in Kentucky.
- This legislation will treat the taxation of net income of pass-through entities like LLCs in the same way as federal law.
The proclamation will focus the special session on tax relief for small businesses, assuring a short and successful session. The State Budget Office has projected that this bill will reduce taxes on small business and small business owners by about $45 million within the biennium, which begins July 1.
“I am very pleased with the bill that has been drafted, and I am very pleased with the collaborative, bi-partisan process between which my office and the leadership of the House and Senate which led to our agreement on the terms of the bill,” Governor Fletcher said.