House Passes their Version of Budget, Senate Attacks Tax Cut Proposals

Only 6 weeks remain in the 2025 legislative session. This week, the topic of state revenues took center stage in both chambers. While the House finalized the state budget on Thursday, the Senate spent much of its week debating whether to phase out the state’s capital gains tax. Several Senators questioned whether a tax cut of nearly $335 million in the coming fiscal year was prudent, given the uncertainty over federal funding and projected decreases in state revenues. The Senate, nonetheless, Perfected the House legislation, giving first-round approval to substitute language that phases out the state capital gains tax, enhances the circuit breaker property tax credit, and provides enabling language for various local sales taxes.