A Democratic lawmaker from Bozeman is proposing a tax increase on the wealthy to make up for shortfalls in state budget.
Representative Tom Woods introduced his bill in the House Taxation Committee Tuesday morning. He says Montana needs to find new ways to make money, during a time of downturn in commodity sales the state relies on, such a coal, oil and gas.
"Our economy is shifting, and our tax policies need to shift along with it," says Woods.
If passed, HB-452 would increase taxes for people making more than $500,000 per year by one percent, and by half a percent for people making $300,000 a year.
According to a fiscal report from the governor's budget office, the new taxes would generate $30 million over the next two years.
Woods' bill is similar to a proposal by Governor Steve Bullock. When Bullock released his biennial budget late last year, he called for a one percent increase on people making more than $500,000 a year.
Representative Tom Woods said he would be willing to change the language of his bill so that the tax increases would end in a couple years, when the state's budget is in a better spot.
But Republicans, including Representative Greg Hertz from Polson, pushed back on Woods' proposal, saying it could drive the some of the biggest contributors to Montana's tax pool out of state by creating a unfriendly tax climate:
"So are you willing to take the risk of 50 people leaving this state and no longer paying taxes, and we lose the $24 million they are paying right now, for a possibility to make an increase here," Hertz asked.
The House Taxation committee, held by a Republican majority, did not immediately vote on the bill, but will likely do so in the coming week.
