Utah Legislative leaders released their latest budget figures Friday, cheering the numbers as a positive outlook of revenue and room for another income tax cut — although they still expect to reduce statewide spending.
According to a fact sheet Senate leaders shared with reporters Friday, state economists predicted in December that Utah’s economy would grow over the next year and a half to the tune of more than $750 million in new state tax revenue over the next two fiscal years.
“That represents a 4.8% year-over-year growth rate, a sign that Utah families are working, businesses are expanding and our economy remains resilient,” the release from leaders read.
The new revenue figures follow a federal income tax cut passed last year as part of the One Big Beautiful Bill, which made permanent current tax rates that were set to expire at the end of 2025. Following that change — which represented a loss of about $300 million in expected income for the state — economists still predicted that Utah’s revenue would grow by 3.1%.
These are, Senate President J. Stuart Adams, R-Layton, said during a news conference Friday, “some good numbers.”
The revenue figures solidify the likelihood that Utah will slash income taxes for the sixth year in a row — a move Democrats and progressive advocacy groups have criticized as the GOP-supermajority Legislature eyes budget cuts for schools and other government programs.
The Legislature lowered the state income tax rate from 4.55% to 4.5% last year. This session, Sen. Dan McCay, R-Riverton, is proposing further reducing that rate to 4.45% in SB60. His Senate colleagues have already approved the measure, and it is now being considered by the House of Representatives.
Senate Minority Leader Luz Escamilla, D-Salt Lake City, said during Friday’s news conference that she was “actually very optimistic” about the revenue numbers and hoped they would allow the state to invest in social services spending priorities.
But Republican Senate leaders said they still expected funding cuts and would not be able to fulfill a number of spending recommendations from legislative subcommittees.
“The people that we deal with that are requesting money, there is never enough,” Sen. Jerry Stevenson, R-Layton, who serves as the Senate chair of the Executive Appropriations Committee, said. “We’ve never had a year when there’s been enough.”
The Executive Appropriations Committee determines what is included in the Legislature’s budget proposals. Committee members must finalize their funding decisions by the end of next week, ahead of major budget bills being published the following Monday.
Asked why they aimed to look for tax cuts rather than limiting spending cuts, Adams argued that tax cuts will continue to grow the state’s economy.
“When you cut tax a little bit, that money goes back into the economy,” he said. “And what happens when that money goes back into the economy, that $100 million, people buy things with it, and it actually increases the revenue, and we see that happen as our economy grows.”
Utah’s wealthiest residents have benefited most from the state’s repeated income tax cuts. According to an analysis of this year’s planned cuts by the Institute for Taxation and Economic Policy for child advocacy group Voices for Utah Children, that pattern would continue under SB60.
Analysts at the left-leaning think tank estimate the top 1% of earners in Utah would save $1,212 annually, while the bottom 20% — or those making less than $34,600 a year — would save $13. Middle-class households that bring in between $34,600 and $157,300 would see annual savings between $24 and $57.
Voices for Utah Children has pushed back against Utah’s income tax cuts for years now. On its website, it describes the Legislature’s approach to the state’s budget as “a cycle of robbing essential public goods to fund permanent tax breaks, mostly for the highest earners, while working families pay the price.”