The full Senate today passed a bill to increase the state sales tax by one-half cent to 6 1/2 percent effective July 1, 2001. The measure is expected to generate about $396 million in new revenue in the next fiscal year and more than $400 million in the following fiscal year, 2002-03.
The measure would repeal all state taxes effective on July 1, 2003. Senate Finance, Ways and Means committee members settled on the bill yesterday, one of several that it examined, as a vehicle to begin discussion on how to fund the expected $800 million gap between proposed spending and available revenue in the next fiscal year.
The bill likely will look very different when it emerges from a Senate-House conference committee.