SALT LAKE CITY, Utah (ABC4 News) – A tax overhaul in Utah is being proposed that would mean services like an Uber ride or a hair cut would be taxed.
At the same time, legislative leaders promise a broader tax base will mean a lower sales tax rate.
“What we want to bring is predictability for you as a taxpayer, and to remove the incentives for rapid government growth and for future tax increases,” said State Sen. Lincoln Fillmore.
“We want to broaden the base and lower the rate so that you’ll probably pay tax on a few more things, but the typical family is going to save over 600 dollars a year in taxes,” added Fillmore.
The reason Republican lawmakers are pushing for change is connected with the rise of the service industry — and the drop in overall income tax the state collects as a percentage.
“Years ago, 41 percent of our revenue was derived from income tax, 41 percent was derived from sales tax,” said Rep. Tim Quinn, who represents House District 54.
“Today, those numbers are 52 and 31 respectively,” he added.
Quinn is sponsoring the bill, called the Tax Equalization and Reduction Act; according to lawmakers it would drop the overall sales tax rate to 3.1 percent and drop the income tax to 4.75 percent.