Kansas Senate Bill SB300

Kansas 2025-2026 Regular Session

• Introduced: 1/12/26
• Refer: 1/13/26
• Report Pass: 2/3/26
• Engrossed: 2/12/26
• Refer: 2/12/26
• Report Pass: 3/5/26
• Enrolled: 4/10/26

Caption

Providing for the apportionment of business income by manufacturers of alcoholic liquor depending on whether the taxpayer is a qualifying Kansas investor or a general manufacturer and removing obsolete reference to global intangible low-taxed income provided for under the federal internal revenue code in determining Kansas adjusted gross income.

Summary

SB300 revises Kansas income tax apportionment rules and several income tax modification provisions. The bill’s central change is to the way business income is apportioned for tax purposes, especially for manufacturers of alcoholic liquor. Beginning in 2027, qualifying Kansas investors in alcoholic liquor manufacturing may use the single-sales-factor method if they meet specified property and payroll thresholds, while other alcoholic liquor manufacturers generally remain under the three-factor formula. The bill also preserves and clarifies existing apportionment elections for certain taxpayers and updates cross-references and statutory language to reconcile overlapping amendments. The bill also makes a broad set of changes to Kansas adjusted gross income rules. It removes an obsolete reference to global intangible low-taxed income (GILTI) and updates the treatment of deferred tax impact deductions, limiting that deduction to publicly traded companies and setting a long-term phase-in schedule beginning in 2035. In addition, SB300 adds or preserves numerous subtraction modifications tied to retirement income, savings accounts, federal tax changes, and other targeted categories, while also incorporating new future-effective deductions related to health care sharing expenses and portable benefit plan contributions. The bill repeals the prior versions of the affected statutes and replaces them with the revised language. The bill’s impact on state law is primarily on Kansas corporate and individual income tax administration. It changes how certain businesses, especially alcoholic liquor manufacturers, calculate Kansas-source income and it adjusts the timing and eligibility for a deferred tax deduction tied to the shift to single-sales-factor apportionment. For individuals, it continues to define Kansas adjusted gross income through a long list of additions and subtractions, including retirement benefits, Social Security, homebuyer savings accounts, adoption savings accounts, and other tax-preference items. It also cleans up statutory references to align with other pending legislation and federal tax terminology. The general sentiment around SB300 appears strongly favorable and noncontroversial. The bill passed the Senate 40-0, the House 122-0, and both chambers later adopted the conference committee report unanimously. That voting history suggests broad bipartisan agreement on the tax changes and the technical corrections in the bill. There is little evidence of major contention in the available record. The most notable policy distinction in the bill is the special apportionment treatment for qualifying Kansas investors in alcoholic liquor manufacturing versus general manufacturers, which creates different tax outcomes based on investment and employment thresholds. Another potentially sensitive feature is the deferred tax impact deduction, which benefits publicly traded companies and phases in over a long period, but the unanimous votes indicate those provisions did not generate visible opposition in the legislative process provided here.

Impact

SB300 amends Kansas income tax statutes K.S.A. 79-3279 and 79-32,117, replacing prior versions and repealing conflicting or duplicate amendments. It changes business income apportionment rules for manufacturers of alcoholic liquor, creates a special single-sales-factor election for qualifying Kansas investors, and preserves the three-factor method for general manufacturers. It also updates Kansas adjusted gross income modifications by removing obsolete federal GILTI language, revising deferred tax deduction rules, and maintaining numerous additions and subtractions affecting corporations and individuals, including retirement income, savings accounts, and other targeted tax preferences.

Sentiment

The bill appears to have enjoyed broad, bipartisan support throughout the legislative process. It passed the Senate unanimously, passed the House overwhelmingly, and both chambers unanimously adopted the conference committee report. The absence of recorded dissent or committee controversy suggests the measure was viewed as a technical and policy update to Kansas tax law rather than a divisive tax overhaul.

Contention

No major contention is reflected in the available transcripts or votes. The main substantive policy choices are the preferential apportionment treatment for qualifying Kansas investors in alcoholic liquor manufacturing and the limitation of the deferred tax impact deduction to publicly traded companies, which could affect different classes of taxpayers differently. However, the unanimous votes indicate that any disagreement over those distinctions was either minimal or resolved before final passage.