Not to be outdone, the Senate and House also are contemplating whopping tax breaks for the 2007 budget over which they, constitutionally, will have the last word.

Though the revenue numbers at this point are projections, even conservative Senate leaders are talking about a $40 million to $60 million tax cut.

House leaders would raise the ante to $100 million in tax cuts. And that could shoot up to $150 million or even $200 million over the next two years.

These tidings of joy come as a result of combination of forces, economic and political.

Utah has entered "a major economic expansion," fueled by job growth, new construction and a growing surplus, according to Utah Tax Commission economists. Tax collections have run ahead of expectations by $91.1 million in the first four months of the fiscal year that began July 1.

Meanwhile, a tax reform initiative this summer uncovered creative ways to cut and shift taxes, including lowering the individual income tax rate and the removal of the hated sales tax on groceries.

Finally, many lawmakers fear Utah government is getting too big. Economic development, they say, is best driven by taxpayers with extra cash in their pockets.

These fiscal and economic forces recently have been supercharged by a round of political one-upmanship between the House and the Senate - and now the Governor's office - over who will back the biggest tax break. 2006 is an election year after all.

House Speaker Greg Curtis envisions a budget with a $100 million tax cut this year- $80 million coming from eliminating the tax on groceries and $20 million in cuts of business taxes.

The House plan would shift the impact of removing the grocery tax into a hike in sales tax on other non-food products, which would make up for all but about $35 million of the revenue loss. But the Senate and apparently the governor's plans would release the entire amount as a tax break.

If the revenue surplus is indeed, "unprecedented, record-breaking" as predicted, Curtis said, the House would support returning even more money to taxpayers.

Rep. Wayne Harper, House chair of the Interim Revenue and Taxation Committee, says removing the grocery tax, plus instituting a single statewide sales tax on non-food items, added to a lower personal income tax rate could amount to roughly $200 million in cuts.

But Curtis cautions, "This is all based on predictions. You want to make sure it is sustainable. One of the things I learned in life is you never spend your money before you get it."

A few years ago, the state found its revenues running short, requiring a painful shifting of needed funds from road maintenance to education and other programs.

"We have to show restraint," Curtis said of tax break schemes. "As good as the economy is now, undoubtedly there is going to be a downturn. It's a matter of cycles."

Curt Bramble, Senate chairman of the Interim Revenue and Taxation Committee, says Senate leaders have informally polled members and found a consensus for a $40 million to $60 million tax break.

"You are seeing a movement toward common ground," Bramble says of the proposals coming from the Senate, House and governor.

Bramble, however, is concerned that as yet, no one has considered the impact on small towns of eliminating the food tax, which fund many services.

Huntsman's budget hits on several themes, including tax reform, tax cuts and other incentives to economic development, says Huntsman spokesman Mike Mower.

"In the past couple years, we have not been able to fund some things as well as we'd like - education, transportation, economic development and state employee compensation," he said, adding that today's budget is the first solely produced by Huntsman's staff.

While it appears the governor and the lawmakers are in agreement on reducing or eliminating the grocery tax, Mower said the governor is not enamoured with a potential compromise that would simply refund $75 per person to low-income people. "Removing the sales tax on food has always been a Huntsman priority," Mower said.

In the end, balancing what the governor sees as adequate highway and education funding against lawmakers' fear of expanding state government could trigger a philosophical clash on the Hill.

"We have a rapidly growing state with rapidly growing needs in education and transportation," Mower said in defense of a budget that breaks the $9 billion ceiling while offering smaller tax breaks.

The governor will have to convince lawmakers like Harper, who believe, "The only way to put breaks on government growth is to reduce the ability of government to get revenues."

Gov. Jon Huntsman Jr. is expected to release a spending plan topping $9 billion. While it would be a record budget, it also has recommendations for a tax cut. And lawmakers have designs on tax reductions, too, setting up a three-way competition.

* The governor will call for a $60 million cut

* The House wants a $100 million reduction

* The Senate is targeting a tax cut of $40 million to $60 million