On December 11, 2009, Governor Gary R. Herbert released his recommendations for Utah's 2010-2011 fiscal year budget. Although the Governor did not propose any new taxes, his recommendations include two proposals to modify current tax law in two respects. First, he proposes that individual's begin making quarterly estimated income tax payments beginning in tax year 2011. Utah is currently one of only three states having income tax that does not require quarterly estimated payments (the other two being Idaho and Tennessee). This change would accelerate $125 million of tax collections into the fiscal 2011 budget year.
Second, the Governor proposes repealing the sales tax vendor discount beginning in July 2010. Businesses having sales tax over $50,000 in the previous year must remit sales taxes on a monthly basis. The state pays these vendors 1.31% of the combined collected sales tax as a means to offset the financial burden of monthly filing versus annual filing. Technology has brought down the cost of monthly filings and so the vendor discount is no longer deemed necessary. This change would result in annual savings to the State of $20 million, beginning with the fiscal 2011 budget year.
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