Here are your new state taxes

The following information comes from Montana Free Press.

This week, Governor Greg Gianforte signed House Bill 337 into law.

House Bill 337 reduces the state’s top-bracket tax rate down from 5.9% to 5.4% over the next two years. (According to figures from the Montana Department of Revenue, the highest-earning 20% of individual taxpayers reported 64% of the state’s taxable income and paid 70% of state income taxes collected in 2023.) It also raises the maximum threshold for the state’s lower tax bracket, where income is taxed at a lower 4.7% rate, and expands a tax credit available to lower-income working families.

For an individual filer earning $50,000 a year and claiming a $15,000 standard deduction — therefore with $35,000 in taxable income — the bill will result in $167 in annual savings once fully implemented, according to MTFP calculations. For an individual filer earning $200,000 a year and taking that same standard deduction, the annual savings would be $1,004.

The governor’s budget office estimates the tax cut will reduce state revenues by $278 million a year by 2028.

Meanwhile, "Federal grants account for 43% of the state government’s total annual revenue" (https://mtnonprofit.org/mna-resources/impacts-of-federal-funding-cuts-on-montanas-economy/). If the feds cut back, how will Montana pay for itself?