Legislators showed courage in addressing unfair tax on banks

The Kentucky legislature made a change last week in the way Kentucky banks are taxed at the state level. Since 1996, Kentucky banks have paid an annual bank franchise tax in lieu of state income tax.

This tax was based on total capital held by the bank regardless of total income for the year. As most Kentucky banks are very strong with high capital ratios, the tax was excessive. In some instances, banks have lost money for a given year, paid no federal income tax and were required to pay the full bank franchise tax. This tax currently is estimated to be 9.6 percent statewide, while the state corporate income tax is 5 percent, a 92 percent inequitable difference between banks and all other Kentucky corporate tax payers. After the repeal state lawmakers courageously made, Kentucky community banks will now pay the same tax all other corporate tax payers pay starting in 2021.

Due to the extremely high bank franchise tax, the highest of all states in the country, Kentucky banks became a target for out of state purchasers. Nearly $1 billion of bank capital has already moved to bordering states who enjoy more favorable tax environments. Those states have aggressively solicited Kentucky community banks to move their home office across the state line to benefit from the tax savings.

It is important to note that Kentucky community banks continue to pay local property taxes, local deposit taxes to both cities and counties, and employ more than 20,000 Kentuckians.

On behalf of Peoples Exchange Bank, I appreciate the courage our legislators had to address this unfair tax issue and their efforts to preserve Kentucky’s community banks.

Charles Beach III

Chairman of the board, Peoples Exchange Bank

When ‘tidying up’ Goodwill can help others with donations

There is much media interest in the Marie Kondo craze, which started with a Netflix series, “Tidying Up.” The KonMari approach to organizing emphasizes de-cluttering your life by getting rid of everything that doesn’t “spark joy”. Some articles even say that charities are receiving too many donations of used items these days, as people take Marie’s advice and clean out closets, sheds and attics.

Are donations at Goodwill Industries of Kentucky up this year? Yes, they are. Do we have too many donations? Absolutely not! Not in the Bluegrass region. Not anywhere in Kentucky. We operate stores in many smaller Kentucky communities where donations are very low, and goods from more heavily-populated areas help make it possible for us to sustain those rural stores. In communities where there is a high level of poverty and very few jobs, a Goodwill store is a godsend.

But what do those donations support? Some social media posts claim that a rich man owns Goodwill and takes all the proceeds. This is “fake news,” and the truth is that every donation we receive helps to support Goodwill services: helping people find jobs, get on a career track and acquire reliable transportation, so they can build the kind of life that many of us take for granted.

We have 70 career coaches statewide, half of whose jobs are funded with proceeds from our retail stores, and they match thousands of people with community jobs. Many of our own retail employees have a disability of some kind, lack a high school education or have criminal offenses in their background. We offer them the opportunity to build a better life, which many of them use in admirable ways. Your donations make that possible.

So, don’t worry about whether your donations are welcome or needed at Goodwill. As long as there are Kentuckians who need a helping hand to become employed and stabilize their lives, we’ll be very grateful for each and every donation, and we pledge to put them to good use.

Amy Luttrell

President and CEO

Goodwill Industries of Ky.