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The state is on the brink of adopting a new tax system that is billed as easier to use and more predictable.
Oh yeah, and you pay less.
The Senate passed a tax package that would totally revamp the income tax and make slight reductions in the sales tax. House Republicans have already adopted the plan in their caucus, but have yet to cast an official vote.
Under the compromise reached with Gov. Jon Huntsman Jr., the average person may save a few hundred dollars each year, but over the entire taxpayer structure that would equate to a $211 million tax cut.
The plan "will be a real boon to Utah's economy and will help make our tax rate more competitive with our surrounding states'," said Huntsman spokesman Mike Mower.
Huntsman and Republican leaders in the Legislature adopted some goals for tax changes a few years ago. They wanted a system that would attract companies to relocate, would be easier for an individual to figure out and would be better able to withstand economic downturns.
"This package meets all of those goals," said Senate Majority Leader Curtis Bramble.
Instead of an income tax system with a variety of tax brackets and more than 20 deductions, the Legislature would move to a single 5 percent tax rate with only a few credits.
Credits are taken out after a person figures out his or her tax burden, while deductions are applied beforehand.
These credits would still take into account children, mortgage payments, retirement and charitable giving. But they would phase out as a person's income grows, providing a bigger impact for Utah's poorer residents.
Cutting the state's income tax collections by $110 million would mean that 90 percent of taxpayers would see their burden decrease.
Most of those who would end up paying more are among Utah's wealthiest residents, particularly those who have large families, huge mortgages and give a lot to charities, House Republican leaders said.
The 5 percent single-rate system would replace a two-pronged income-tax plan approved last year.
The two-pronged plan - in which taxpayers pick between the standard deduction-based income tax or a 5.35 percent flat tax - is in effect this year.
If the Legislature passes the new plan, it would go into effect in 2008.
In the same bill, lawmakers would trim the general sales tax by one-tenth of 1 percent and the state's portion of the tax on groceries by 1 percentage point.
Combined, these trims would save the average Utahn $54 a year, according to legislative staffers.
The tax cut package also includes some targeted business cuts that would help miners, cable subscribers and dentists among others.
Senate President John Valentine called the massive bill "historic."
It had only two dissenters. One of them - Sen. Scott McCoy, D-Salt Lake City - said he voted against the bill more because of the process than its impact.
"I haven't had it long enough to know much about it," he said. "I'm going to do the conservative thing and vote no."
Senate Republicans said they expect House members to "fine tune" the plan in a series of amendments in the next two days.
And the bill is so complicated and came so late in the session that lawmakers are asking Huntsman to call a special session later this year so they can appropriately remove what would be the old income tax plan from the law.
"We know it is not perfect, but this is a major step," Bramble said.
SB223:*Would cut taxes by about $211M.
Next step: The bill now goes to the House.
The plan ''will be a real boon to Utah's economy and will help make our tax rate more competitive with our surrounding states.''
MIKE MOWER
Spokesman for Gov. Jon Huntsman Jr.
* Income tax: $110 million cut
Would create 5 percent single-rate system with credits for dependents, retirement, mortgage interest and charitable giving.
* General sales tax: $41 million cut
Would take state sales tax rate from 4.75% to 4.65%.
Would save an average buyer $10 a year.
* Sales tax on unprepared food:
$40 million reduction
Would cut the state sales tax on food by 1 percent and create a statewide 3% rate.
Would save an average buyer $44 a year.
Source: Utah Legislature