Tax Reform

About the Commission

Twenty-three Kentuckians, representing a broad spectrum of public and private sector experience and all corners of the state, served on the Blue Ribbon Commission on Tax Reform.

The Commission, led by Lieutenant Governor Jerry Abramson, worked to develop recommendations to make the state’s tax code more responsive to the ups and downs of the economy, as well as to make taxes more equitable for Kentuckians.

The Blue Ribbon Commission was assisted by an outside consultant, as well as advisers from both inside and outside of state government. This included:

  • State Budget Director and Secretary of the Executive Cabinet;
  • Secretary of the Finance and Administration Cabinet;
  • Secretary of the Economic Development Cabinet;
  • Commissioner of the Department of Revenue;
  • Taxation Committee of the Kentucky Society of CPAs; and
  • Taxation Section of the Kentucky Bar Association.

Legislators from both the House and the Senate served as ex officio non-voting members. The Commission received testimony from outside experts, interested groups and the general public.


Goals for the Commission

The five goals for the Commission’s work include:

  • Fairness: The tax system should treat people equitably. The Commission will review the tax burden that different taxpayers shoulder, from Kentucky families to Kentucky businesses, from small businesses to big businesses, and within different industry sectors in the state.
  • Competitiveness: Any changes to the tax system should ensure that Kentucky continues to attract jobs and investment to the state, while keeping and protecting the jobs and businesses we already have. The Commission will review how Kentucky’s tax environment compares to other states and identify ways to improve business tax competitiveness.
  • Simplicity and Compliance: A tax system should be easy to understand and follow. The Commission will make recommendations to ensure compliance with Kentucky’s tax system is simple for individuals and businesses and to ensure efficient administration by the state.
  • Elasticity: The tax code should allow state revenue performance to mirror economic performance. While Kentucky’s code has performed relatively well during the recession, revenue growth has not kept pace with changes in the economy.
  • Adequacy: The Commonwealth’s tax structure should generate sufficient funds to support critical state services. The Commission is charged with reviewing the adequacy of revenues from the current tax structure and making recommendations for improvement.
The Tax Reform Proposal by Governor Steve Beshear
A Presentation to House Appropriations and Revenue
February 11, 2014
Lt. Governor Jerry Abramson


“In order to better prepare our state for the future, we must study how we can better align our tax code with the principles of fairness, business competitiveness and a 21st Century economy. An improved tax code will not only create a more welcoming business environment, but will also allow the state to invest in the services and priorities that best position our citizens for success.”

—Steve Beshear


“This effort to review and revise our tax code is critical, not only for our budget outlook but also for our future economic success as Kentuckians. Making the right changes to our tax system will allow us to make the key investments in education and workforce development that will propel Kentuckians into a more secure and successful economic future.”

—Jerry Abramson