Today the Utah Legislature gave final approval to two significant tax cut bills.
The Legislature passed Senate Bill 60, which provides a $123 million cut to Utah’s income tax and moves the state’s income tax rate from 4.50% to 4.45%. This marks the sixth year in a row Utah has lowered its income tax rate. We estimate that the cumulative impact of these consecutive income tax cuts results in savings of $300–$400 per year for the average Utah family.
House Bill 575 cuts the state motor fuel tax by six cents beginning July 1 and expires on December 31. The cut provides $40 million in relief at the gas pump and will take effect when prices are traditionally higher for Utah drivers. On December 31, the state gas tax will once again be calculated by the State Tax Commission using the motor fuel tax formula established in state law.
“Today is a win for Utah taxpayers. For the sixth straight year, lawmakers have cut the income tax and are providing relief at the gas pump this summer. It’s clear Utah’s leaders are committed to keeping the state affordable for families and businesses.”
In addition to these cuts, the Legislature also allowed the state to fully conform to the federal government’s H.R. 1 of 2025, also known as the One Big Beautiful Bill. This results in an additional $300 million in tax benefits for Utah individuals and businesses by not taxing certain types of income, such as tips and overtime, and by allowing full immediate expensing for businesses that engage in research and development within the state.
