- Gov. Greg Gianforte wants the Montana Legislature to replace two income-tax brackets with a 4.7% rate on all taxable income.
- The proposal could reduce state revenue by $130 million to $210 million, depending on the estimate and assumptions.
- Supporters project economic gains, while opponents say top earners receive the largest cuts and public services could lose funding.
Gov. Greg Gianforte is urging lawmakers to replace Montana’s two-bracket income tax with a 4.7% rate on all taxable income. The proposal is a priority for the 2027 legislative session, but lawmakers must enact it before it becomes law.
He announced the initiative on September 8, 2026. Gianforte has called it a “flat fair tax,” describing it as “fair” and “simple,” with “one rate for everyone.”
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The campaign has moved beyond the Capitol. Gianforte later joined the Mountain States Policy Center in promoting its “Flat. Fair. Montana.” effort.
Republican Senate leaders have signaled support. Legislative Democrats oppose the plan over its projected revenue effects and distribution of tax cuts.
The proposal would remove the higher bracket
Montana currently taxes income in two brackets. The lower bracket is 4.7%, while the higher bracket is 5.65% for tax year 2026. Under current law, the top rate is scheduled to drop to 5.4% in 2027.
The lower bracket covers taxable income below $47,500 for single filers and $95,000 for married couples filing jointly. A separate description of the 2027 brackets lists thresholds of $65,000 for single and married-filing-separately taxpayers, $130,000 for joint filers and $97,500 for heads of household. Income above those 2027 thresholds is scheduled to face the 5.4% rate.
The governor’s plan would eliminate the higher bracket. Taxable income would instead face 4.7%, regardless of how much a person earns.
The largest direct cuts would go to people in the top bracket
People whose income reaches the higher bracket would see the clearest direct reduction. Taxpayers already paying 4.7% on all or most of their taxable income would generally receive little or no direct cut.
Rose Bender, research director at the Montana Budget and Policy Center, said the top 1% of Montana earners could save nearly $9,000 a year. She said 99% of people near middle incomes would see no savings, and characterized the proposal as tilted toward wealthy households.
Business owners could also be affected. Some partnerships, LLCs and S corporations report business income on owners’ individual returns, where the lower top rate would apply under the proposal.
Patrick Fitzpatrick, a candidate for Montana Senate District 6, said the plan would shift more of the tax burden toward middle- and working-class Montanans while giving the largest reductions to high earners. Opponents also argue that reduced revenue could leave less available for public services.
Estimates range from $130 million to $210 million
State analysts estimate the proposal could reduce revenue by $130 million to $140 million by the 2029 biennium. A separate estimate puts the static loss at about $210 million before accounting for economic responses.
The Mountain States Policy Center estimates the reduction could be approximately $192 million after projected economic growth. The figures use different baselines, effective dates and assumptions about taxpayer behavior and economic activity.
Chris Cargill, the center’s chief executive officer, says Montana needs to compete with nearby states that have lower or flatter income-tax systems. The group projects that the change could add about $525 million in annual gross state product and $286 million in annual wages.
Its projections also include roughly 2,445 additional full-time-equivalent jobs and about $642 in increased annual income per Montanan. Supporters argue that investment, business formation and broader economic activity could offset some of the budget reduction.
Cargill has criticized estimates that assume “nothing changes,” arguing they leave out behavioral and economic effects. The revenue estimates therefore turn in part on whether projected growth follows a tax cut.
Campaign events are planned across six Montana cities
The Mountain States Policy Center scheduled town halls ahead of the 2027 session in Helena, Missoula, Kalispell, Bozeman, Great Falls and Billings.
The meetings give supporters a public platform to make the case for lower rates and projected economic gains. Opponents have focused on who receives the direct savings and the possible loss of public revenue.
Lawmakers will decide whether to advance the proposal during the 2027 session. Until they enact it, Montana’s existing brackets and scheduled 2027 rate change remain in place.
