Governor Gianforte Unveils Budget for 2027 Legislative Session: Realizing the Montana Comeback

Proposes 4.7% flat income tax rate, boosts Budget Stabilization Fund to historic level

Governor's Office

HELENA, Mont. - Governor Greg Gianforte today unveiled his budget, "Realizing the Montana Comeback," highlighting Montana's strong fiscal position to support a 4.7 percent flat income tax rate while fully funding K-12 public education, public safety, and investments to secure a stronger future.

Governor Gianforte's budget for the 2029 biennium continues to fulfill many policy priorities outlined in his Montana Comeback Plan, a roadmap introduced during the governor's 2020 campaign.

"When I took office, I made Montanans a promise to create more good-paying jobs and protect the Montana way of life so our kids and grandkids don't have to leave the state we love," Gov. Gianforte said. "Because we've been good stewards of taxpayer dollars, cut taxes, cut red tape, promoted individual freedom, and supported law enforcement, Montana is stronger than ever before. This budget is about Realizing the Montana Comeback and knowing that at the end of my term, we will have left Montana better than we found it."

Gov. Gianforte unveiling his "Realizing the Montana Comeback" budget for the 2029 biennium

A pillar of the governor's budget proposal is for a 4.7 percent flat income tax rate and a boost of the earned income tax credit from 20 percent to 30 percent of the federal credit to benefit lower- and middle-income Montanans. Taken together, those two proposals provide Montanans with $220 million in permanent income tax relief. Since taking office, Gov. Gianforte has delivered the largest income tax cuts in state history, reducing the top income tax rate from 6.9 percent to 5.4 percent and increasing the earned income tax credit.

To protect taxpayers from a potential downturn in the economy or an unexpected state expense, the budget invests an additional $300 million of one-time-only funding into the Budget Stabilization Fund, bringing it to nearly $900 million, a record amount. It also doubles the Fire Suppression Fund, bringing it to a historic level, to ensure firefighters have the tools they need to protect lives, homes, and livelihoods during wildfire season.

The governor's budget also expands the business equipment tax exemption from $1 million to $3 million, eliminating the business equipment tax burden for more than 500 small businesses, farms, and ranches. This proposed increase comes on the heels of the governor's first-term investments that eliminated over 5,000 small businesses, farms, and ranches from the business equipment tax payroll.

Knowing that safe, healthy communities are part of the foundation to secure Montana's future, the governor's budget fully funds public safety and proposes a $25 million investment of one-time funding to boost the Behavioral Health Systems for the Future Generations Fund to secure resources for mental health care, and a $5 million investment of one-time funding to expand shelter capacity for victims of human trafficking. It also invests $10 million in one-time-only money into local 911 emergency systems to upgrade call centers and improve response times.

For continued investments in infrastructure, the governor's budget includes $100 million in one-time-only funding for county roads and bridges and $125 million in one-time-only funding for the State Highway Trust, to ensure costs associated with state road maintenance are not passed onto Montanans in the form of a gas tax hike.

The budget proposal also protects record funding in public education and expands education freedom for Montana families by securing the statutory increase of the Big Sky Scholarships to total $24 million. It also includes $13 million in one-time-only funding to fill the school facilities trust to invest in improving school buildings and maintenance needs and $1 million in one-time-only funding to support cell phone-free school policies.

The governor's budget also supports state employees, proposing a $30 million investment of one-time-only funding for the State Health Plan and $14 million of one-time-only funding for one-time bonuses for state employees. Noting past historic investments in state buildings, Gov. Gianforte underscored a previous $800 million investment in long-term building investments to complete overdue maintenance in Helena and expand prison capacity.

Before concluding the press conference, the governor highlighted Montana's place in national rankings as the state with the fifth fastest-growing economy, second highest hourly wage growth, eighth lowest unemployment, seventh best fiscal health, and ninth fastest job growth, noting his action in 2023 that eliminated all of the state's debt.

"Since 2021, our economy has grown by 16 percent, the fifth-fastest rate in the nation. We've eliminated all the state debt, saving taxpayers $40 million over a period of two years. I don't know of another state that doesn't have any debt," Gov. Gianforte added.

He continued, "In just six years, we moved from twenty-second in the nation for fiscal health to seventh. All of this happened while we cut income taxes - proving we don't have to choose between a strong balance sheet and letting Montanans keep more of what they earn. We can do both."

Gov. Gianforte also praised previous collaboration with legislators to enact conservative budgets that keeps spending growth below inflation and highlighted looking forward to working with them in 2027 to continue to bring the American dream into greater reach for all Montanans.

The governor's "Realizing the Montana Comeback" budget for the 2029 biennium will be formally released on Monday, November 16.

To watch the governor's budget announcement, see here. A one-pager with the governor's top budget priorities can be downloaded here.

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