Bill > SB0085

This bill modifies Utah's income tax rate mechanism by introducing a dynamic tax rate calculation process that will take effect from 2026 onwards. The bill establishes that the income tax rate will be 4.55% for the 2026-2027 tax year, and for subsequent years, the rate will be calculated based on the state's actual revenue compared to forecast revenue. Specifically, if actual state revenue exceeds the forecast revenue, the tax rate will be reduced by an amount designed to return half of the excess revenue to taxpayers, with the rate rounded to the second decimal place. The bill defines key terms such as "consensus entities" (which include the Legislative Fiscal Analyst, Tax Commission, and Governor's Office of Planning and Budget) and "state revenue" (which includes various taxes and unrestricted revenues). The legislation also provides detailed forecast revenue projections for fiscal years 2026-2035 and outlines the process by which the tax commission will publish the income tax rate for each upcoming tax year. Additionally, the bill makes numerous technical amendments to existing tax code sections to reference the new "income tax rate" instead of a fixed percentage, ensuring consistency across Utah's tax regulations.

https://le.utah.gov/~2025/bills/static/SB0085.html