Kentucky's income tax is on track for another cut.

State Budget director John Hicks made the announcement during a committee meeting this afternoon.

Before our shift to the road, let me announce that later today I will submit a report to this committee that for fiscal year 24, the income tax rate reduction conditions have been met.

Those conditions were outlined in a bill passed during the 2022 Kentucky General Assembly, which called for gradually reducing the income tax rate to zero.

It currently sets at 4% for the 2025 calendar year.

State Senator Chris McDaniel, who chairs the Senate Appropriations and Revenue Committee, reacted to today's news.

Onex.

Quote.

Per the Kentucky State Budget director, we have met the conditions to reduce the individual income tax rate to 3.5%.

This is great news reflecting the success of our conservative budgeting approach and our commitment to keep money in the pocket of Kentucky's taxpayers and quote, The decision to further reduce the income tax will need to be acted on by the General Assembly next year.

Once approved, the reduction would take effect in January of 2026.