Bill > SB0116

This bill modifies Utah's income tax structure by establishing a new definition for "income tax rate" that will be 4.5% for taxable years beginning in 2027, then calculated and published annually by consensus entities (Legislative Fiscal Analyst, Tax Commission, and Governor's Office of Planning and Budget) based on state revenue forecasts between 2028 and 2038, and thereafter will remain at the rate of the preceding year. The bill also introduces a mechanism for the income tax rate to decrease by 0.01 percentage points for every $22.2 million (and increasing amounts in subsequent years) of actual state revenue that exceeds forecast revenue, with these adjustments occurring in intervals of 0.01 percentage points. Additionally, the bill amends various sections of Utah code to replace the fixed 4.5% tax rate with the newly defined "income tax rate" in calculations for corporate franchise and income taxes, individual income taxes, withholding taxes on mineral production, and several tax credits, including those for recycling market development zones, capital gains, health benefits, military retirement, social security benefits, and contributions to ABLE accounts. The bill also includes repeal dates for certain provisions, with the new income tax rate structure and related sections set to be repealed on July 1, 2038, and the bill itself taking effect for taxable years beginning on or after January 1, 2027.

Budget and Finance

https://le.utah.gov/~2026/bills/static/SB0116.html