2024 Legislative Session Dates
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Key Takeaways:

  • Given the unprecedented revenue surpluses in states across the country, it’s no surprise that many of those states chose to use a portion of their surplus to reduce tax rates.
  • In recent years, thirteen states have reduced their corporate income tax rates since 2018, and several of those states reduced their rate more than once.

Given the unprecedented revenue surpluses in states across the country, it’s no surprise that many of those states chose to use a portion of their surplus to reduce tax rates. While the trend of reducing tax rates is not a new one, it’s certainly accelerated in recent years. Over the past five years, a record number of states have enacted corporate income tax reductions. Below is a summary of states which have enacted corporate rate cuts since 2018. This report only includes measures that were enacted since 2018, not rate changes that may have been triggered or planned to phase in due to legislation enacted prior to 2018. 

Thirteen states have reduced their corporate income tax rates since 2018, and several of those states reduced their rate more than once. State lawmakers enacted 23 total bills during this period. When comparing partisan makeup, nine of these states were Republican trifectas, one state was a Democratic trifecta, and three states were under divided government.  See the map and table below for a complete description of each income tax reduction since 2018. 

Year

State

Political Makeup

Bill Number

Summary

2022

Arkansas

Republican Trifecta

HB 1002 A 

Accelerates the previously planned corporate income tax cuts which reduce the top marginal rate from 5.7 percent to 5.3 percent (such that cuts that were to take effect in 2025 shall become effective in 2023. 

2022

Colorado

Democratic Trifecta

Initiative 31 

Ballot measure to reduce the corporate income tax rate from 4.55 to 4.4 percent. Effective retroactively to January 1, 2022.

2022

Idaho

Republican Trifecta

Idaho HB 436

Reduces the flat corporate income tax rate from 6.5 to 6 percent. Effective retroactively to January 1, 2022.

2022

Idaho

Republican Trifecta

HB 1A

Reduces the corporate income rate from 6 to 5.8 percent.

2022

Iowa

Republican Trifecta

HF 2317

Uses revenue triggers to decrease the corporate income tax rate from 9.8 percent to as low as 5.5 percent. The magnitude of each rate cut depends on corporate income tax collections.

2022

Nebraska

Republican Trifecta

LB 873

Reduces the top marginal corporate income tax rate from 7.5 percent to 7.25 percent on January 1, 2023. The rate will continue to decrease an average of 0.33 percentage points per year until it reaches 5.84 percent on January 1, 2027.

2022

New Hampshire

Republican Trifecta

HB 1221

Reduces the Business Profits Tax from 7.6 percent to 7.5 percent effective tax year 2024.


2022

Pennsylvania

Divided:

D Governor +
R Legislature

HB 1342 

Reduce the corporate net income tax rate from 9.99 percent to 8.99 percent on January 1, 2023. Each year thereafter the rate will decrease 0.5 percentage points until it reaches 4.99 percent at the beginning of 2031.

2022

Utah

Republican Trifecta

SB 59

Reduces the corporate income tax rate from 4.95 percent to 4.85 percent.

2021

Arkansas

Republican Trifecta

AR SB 1B / AR HB 1001B

Phases down the corporate income rate down from 5.9% to 5.3 percent by 2025 unless a transfer is made to the Catastrophic Reserve Fund between July 1, 2022, and January 1, 2024.

2021

Idaho

Republican Trifecta

HB 380

Reduces the state’s flat corporate income tax rate and top marginal individual income tax rate from 6.925 percent to 6.5 percent.

2021

Louisiana

Divided Government:

Democratic  Governor +
Republican Legislature

HB 292

Consolidates five corporate income tax brackets into three, and reduces the top rate from 8 percent to 7.5 percent, effective in 2022.

2021

Nebraska

Republican Trifecta

NE LB 432

Reduces the higher of the state’s two marginal corporate income tax rates from 7.81 percent to 7.25 percent in 2023. The bill also expresses the intent to pass additional legislation reducing the rate to 7 percent for TY 2024 and to 6.84 percent for TY 2025, though these reductions are not guaranteed without future legislative action. 

2021

North Carolina

Divided:

D Governor +
R Legislature

SB 105

Gradually phases out the corporate income tax until it’s eliminated in 2030. 

2021

New Hampshire

Republican Trifecta

NH HB 2

Reduces the corporate income tax (BPT) from 7.7 to 7.6 percent.

2021

Oklahoma

Republican Trifecta

HB 2960

Reduces the corporate income tax rate from 6 percent to 4 percent.

2020

Colorado

Democratic Trifecta

Proposition 116 

Reduces the income tax rate from 4.63 to 4.55 percent, effective for tax years beginning January 1, 2020.

2019

New Hampshire

Republican Trifecta

HB 4

Gradually reduces the business profits tax rate from 7.7 percent to 7.5 percent over a period of three years. 

2019

Utah

Republican Trifecta

SB 2001

Reduces the corporate income tax rate from 4.95 to 4.66 percent.

2018

Idaho

Republican Trifecta

HB 463

Reduces the corporate income tax rate from 7.4 percent to 6.925 percent.

2018

Missouri

Republican Trifecta

SB 884

Reduces the corporate income tax rate from 6.25 to 4 percent.

2018

Kentucky

Republican Trifecta

HB 487

Reduces the corporate income tax rate from a top marginal rate of 7 percent to a flat 5 percent rate.

2018

Utah

Republican Trifecta

HB 293

Reduces the corporate income tax rate from 5 to 4.95 percent.

Click here for a PDF version of this report.

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