Governor Steve Beshear’s commission studying tax reform should encourage economic growth through job creation and capital investment, the Kentucky Association for Economic Development Association (KAED) president said recently during the commission’s meeting at Bryan Station High School in Lexington.
Hal B. Goode, president of KAED, told the commission that economic developers are Kentucky’s front line and first responders in the competitive global environment of recruiting job creation and capital investment through the attraction of new business development as well as the encouragement of existing business growth.
Goode added, “No group outside of our state’s business and industry leaders are more attuned to the needs and challenges of Kentucky’s business climate, which is directly influenced by a diverse and complex variety of political, economic, cultural, social, geographic, regulatory, infrastructural, educational and workforce issues. Kentucky’s tax structure is but one aspect of these critical issues which impact its business climate.”
The position statement from KAED asked the commission review tax policy in today’s economic development environment to assure that Kentucky’s tax code is competitive. It calls for the elimination of the inventory tax and to establish a research and development (R&D) tax credit.
KAED states they recognize that a study of possible tax reforms may trigger a review of Kentucky’s tax incentives for business development.
Goode acknowledged, “KAED continues our strong support for and our membership’s daily reliance upon the current array of tax incentive programs administered by the Kentucky Cabinet for Economic Development. The current array of state tax incentives is the bare minimum necessary to stay in the game; however, we need more creative, flexible, and aggressive financial incentives to win the game.”
The commission, led by Lt. Gov. Jerry Abramson, includes representatives from both public and private sectors and is being advised by state finance, economic development, and revenue officials. Governor Steve Beshear has said an ideal tax system will allow the state to invest in the services and priorities that best position citizens for success.