The Senate today passed a bill to create a tax exemption for military retirement pay, 30-0 (one didn’t vote and four were present). A similar bill passed the House yesterday; once the twin bills have flip-flopped, they’ll be on the governor’s desk.

The bill would provide tax relief for an estimated 29,000 veterans (there are around 250,000 total veterans in the state). As I explained at length yesterday, the $13 million tax cut for military retirement pay is paid for by an equivalent increase on the sales tax on candy and soft drinks. Completely separately, the bill — part of the governor’s tax package —includes a $6 million tax cut on the wholesale tax on soft-drink syrup. That big giveaway to the soft drink industry is paid for by a tax hike on unemployment benefits and digital downloads.

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