Kansas Governor Sam Brownback’s budget chief, Steve Anderson, has announced that a new tax study committee will be formed to recommend ways to reduce or even eliminate the state’s income tax, according to an article in the Wichita Eagle.
Legislation to phase out individual income taxes and lower corporate tax rates died in the legislature this past session, but evidently the Brownback administration isn’t giving up on its regressive agenda. State representative Jim Ward was being generous when he called this proposal “shameful.”
The graduated income tax is Kansas’s only major progressive tax levied; reducing or eliminating the income tax would ensure that regressive property and sales tax rates would have be raised, or services would have to be cut. If the Brownback administration gets its way, the state’s most vulnerable will suffer the most. Ironically, Brownback came out against an effort to reduce the sales tax just this last November, citing the budget deficit and insisting the state couldn’t afford it.
In a recent speech to a local Republican club, budget chief Anderson fell just short of admitting that corporate leaders are writing the administration’s economic plan. He told his audience the story of a CEO friend who threatened the state of Oklahoma that he would move his company to Texas because it has no income taxes. Anderson said it “drove home to me how important it is to get [income tax] down to that point that you’re at the lowest rate you can be, hopefully zero.”
States too often fall for, and suffer the consequences of, a race to the bottom with other states over taxes. Corporations regularly lead states down this path, and unfortunately, the leadership in Kansas is apparently all too willing to follow their corporate pals.
Representative Ward is right to point out that numerous studies have shown taxes are just one of many factors -- alongside education and other government services -- that corporations consider when making their relocation decisions. A tax code that adequately funds the communications, transportation, power and public safety that support the state’s economy is good for Kansas – both its businesses and its residents.
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