Republican state Sen. Damon Thayer said he will be working in the next two months on legislation for the 2006 Kentucky General Assembly that would exempt horse feed and other supplies from state sales and use taxes.Thayer said he and Rep. Susan Westrom have spoken about introducing companion bills, one in the House and one in the Senate, on the horse farming sales and use tax equity issue. Thayer and Westrom co-chair the Subcommittee on Horse Farming of the Interim Joint Committee on Agriculture and Natural Resources."Hopefully, we can come together on some kind of agreement on the language and drop companion bills," Thayer told the subcommittee at a Nov. 9 meeting in Frankfort.Similar tax equity bills have been introduced in recent years. Most recently, Sen. Joey Pendleton introduced Senate Bill 174 during the 2005 General Assembly. Rep. Joe Barrows also introduced House Bill 349. If passed, Pendleton's bill would have revoked sales and use taxes paid by horse farmers on a broad range of items, including feed, farm machinery and even embryos and semen used for artificial insemination purposes. That bill eventually died in the Senate Appropriations and Revenue Committee. Barrows bill was less broad, yet similarly called for an exemption on feed, supplies, and equipment from the sales and use tax when raising horses as a business. His bill died in the House Appropriations and Revenue Committee.Thayer said two questions that arise regarding a tax equity bill are what would its affect on revenue be and what would be the scope of its design. Thayer said it is the job of he and other legislators to work with the Legislative Research Commission to ascertain a bill that has reasonable fiscal impact in order for the bill to pass."Maybe what we have to do is start out incrementally, and look at a couple of items like the feed, fence, and purchase of equipment," Thayer said. "We have to decide on how narrow or broad we want to make it to see if we can actually get something to the floor for a vote."According to the Kentucky Constitution, a sales and use tax equity bill is considered a revenue bill and must be first introduced in the House of Representatives. "What would be ideal is if we could work ahead of time and pre-file the same bill in the Senate as we do in the House," Thayer said.Pendleton who also serves on the subcommittee said exempting horse farmers from paying taxes on feed and other equipment is the fair thing to do, considering that other livestock farmers are exempt from such taxes."When you're looking at our No. 1 industry in Kentucky now, it's only a fairness issue that we are able to treat them (horse farmers) like we treat everybody else," Pendleton said.Jim Navolio, executive director of the Kentucky Equine Education Project, said his organization would be in full support of sales and use tax equity legislation benefiting horse farmers. "I can promise you one thing from our organization, that if you do get that legislation introduced, we will cover this place up with people in support of it," Navolio said at the meeting.