What is Flat. Fair. Montana.?
Flat. Fair. Montana. is a statewide effort to make Montana’s income tax system simpler, fairer and more competitive. The proposal would establish a single 4.7% individual income tax rate, replacing the current two-rate structure. The basic idea is simple: one rate, clear rules and a tax code that allows Montanans to keep more of what they earn.

Why a 4.7% flat income tax?
Montana has made significant progress reducing income tax rates in recent years, but the state can go further. A 4.7% rate would provide additional tax relief while moving Montana to a simpler single-rate structure. Economic modeling commissioned by Mountain States Policy Center estimates that a 4.7% flat tax could increase after-tax income by $642 per resident, compared with the 2026 baseline.

What does “flat tax” actually mean?
It means Montana would have one individual income tax rate instead of multiple rates. Under the proposal, taxable income would be subject to the same 4.7% rate. A flat rate makes the system easier to understand and provides greater predictability for families, workers and businesses.

Why is a flat tax fair?
We believe fairness starts with treating people equally. Under a flat-rate system, earning another dollar doesn't push that dollar into a higher tax rate simply because a taxpayer crossed an income threshold. The same rate applies across the tax base.
People can reasonably disagree about what constitutes tax fairness. Our case is that a system built around one rate and consistent rules is more transparent, understandable and equitable than one that imposes different marginal rates based on income.

Does a flat tax mean everyone pays the same amount in taxes?
No. Everyone pays the same rate, not the same dollar amount.
Someone with more taxable income would still pay more dollars in income taxes than someone with less taxable income. A 4.7% flat tax simply means the applicable rate is the same.

Is this just a tax cut for wealthy Montanans?
No. Reducing the income tax rate allows taxpayers across the income spectrum who owe Montana individual income tax to keep more of their earnings. The proposal should be evaluated not only by the tax reduction itself, but also by its potential effects on wages, jobs, investment and economic growth.
That is why the Flat. Fair. Montana. effort includes independent economic modeling and analysis of the proposal’s broader effects.

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How would a 4.7% flat tax affect Montana families?
The most immediate effect is straightforward: lower income taxes mean more take-home income for taxpayers affected by the rate reduction.
That can mean more money available for groceries, housing, childcare, saving for retirement, starting a business or simply dealing with the rising cost of everyday life. The economic modeling also estimates an increase in after-tax income of approximately $642 per Montana resident compared with the 2026 baseline.

What would it do for Montana's economy?
Economic modeling of the proposal estimates that a 4.7% flat tax could eventually produce significant economic benefits, including:

• $525 million in additional gross state product

• $286 million in additional wages

• 2,445 additional jobs

• $642 more in after-tax income per resident

These are economic projections, not guarantees. They estimate the potential dynamic effects as people and businesses respond to lower marginal tax rates.

Why would lowering an income tax rate help create jobs?
Taxes affect incentives. When people are able to keep more of the additional income they earn, there is a greater incentive to work, invest, expand businesses and take economic risks.
Those decisions compound across an economy. A business may make an additional investment, an entrepreneur may expand, or an employee may take on additional work. The economic case for the proposal is that reducing the marginal tax rate improves those incentives and ultimately produces greater economic activity.

Can Montana afford this?
Fiscal responsibility is essential to this proposal.
The economic analysis estimates the initial static revenue impact at approximately $210 million. After accounting for projected economic responses to the tax change, the estimated dynamic impact is approximately $192 million.
Those numbers are important because we believe tax reform should be debated with a clear understanding of both its costs and its potential economic benefits—not by pretending a tax reduction has no fiscal effect.

Doesn't Montana need income tax revenue for schools, roads and public safety?
Yes. Montana needs to fund the core responsibilities of state government, and nothing about supporting a flat tax changes that.
The question is whether government can responsibly provide those services while allowing Montanans to keep more of their income. Flat. Fair. Montana. believes tax policy and responsible budgeting should go hand in hand.

Why change the system now?
Because states increasingly compete for workers, families, entrepreneurs and investment, and tax policy is part of that competition.
Montana is surrounded by states with highly competitive tax structures. Wyoming and South Dakota impose no individual income tax, while North Dakota has a top rate well below Montana's. A 4.7% flat tax would strengthen Montana's competitive position while maintaining an individual income tax.

Haven't Montana's income taxes already been reduced?
Yes—and that's an important part of the story.
Montana has significantly reduced its top individual income tax rate and simplified its tax structure over the past several years. Flat. Fair. Montana. builds on that progress. Moving to 4.7% would represent another step toward a simpler and more competitive system rather than an abrupt change in direction.

Why not eliminate Montana's income tax altogether?
States such as Wyoming and South Dakota demonstrate that it is possible to operate without an individual income tax. But eliminating Montana's income tax would require a much larger restructuring of state finances.
The 4.7% proposal is designed as a significant but achievable next step: reduce the rate, establish a single-rate structure and improve Montana's competitiveness while maintaining fiscal stability.

Is this a partisan campaign?
Flat. Fair. Montana. is a public policy and public education effort. The principles behind the proposal—simplicity, transparency, economic opportunity and responsible government—don't have to belong to one political party.
We want Montanans to examine the evidence, ask difficult questions and decide whether a 4.7% flat tax makes sense for the state's future.

How can I learn more or ask questions?
That's exactly why we're taking this conversation across Montana.
The Flat. Fair. Montana. Town Hall Tour will bring tax policy experts, economists and elected officials into communities across the state. Montanans will be able to hear the case for reform, examine the economic research and, importantly, ask their own questions.
This shouldn't be a conversation confined to Helena. It should belong to the people who actually pay the taxes.

What's the bottom line?
Montana has an opportunity to build a tax system that is simpler, more transparent and more competitive while allowing people to keep more of what they earn.
One rate. Clear rules. More opportunity.

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