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Archive for Friday, May 20, 2011

Gov. Brownback starts review of tax code

May 20, 2011

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— Gov. Sam Brownback's administration has started studying proposals for overhauling the Kansas tax system with a goal of lowering income taxes, and he expects a proposal to emerge by the end of the year, the governor said Friday.

Brownback has said repeatedly that he thinks reducing income taxes will spark economic growth, keep residents from leaving and lure people from outside the state.

"I think there's a combination of things that need to be looked at, but to me that the tax that's one of the most sensitive for economic growth is the state income tax," the governor said after an event in Lecompton, about 20 miles east of Topeka. "To look at the total picture is what we want to do, with an eye toward getting the state income tax down."

Brownback said Revenue Secretary Nick Jordan and Commerce Secretary Pat George, both former legislators, are involved in the discussion, but he said he's going to bring "leading thinkers" on tax issues from both Kansas and around nation into it. He said he's not sure whether he'll establish a formal study commission, and he encouraged legislative leaders to consider their own study this summer and fall.

The governor said state officials see Kansas residents migrating to states with lower income taxes or, like Texas, no income tax, and Kansas gains residents from higher-tax states.

This year lawmakers approved Brownback's plan to declare 50 of the state's 105 counties "Rural Enterprise Zones" and exempt anyone who moves into them from outside Kansas from state income taxes from 2012 through 2016.

But some legislators, particularly conservative Republicans, wanted to go further. The House passed a plan this year to lower income taxes whenever state revenues grow, but the idea stalled in committee in the Senate.

Democrats have been skeptical of such efforts, noting that the budget approved by legislators this year cuts general state aid to public schools by 5.6 percent, or $232 per student, as Brownback had proposed. Also, the state cut its overall spending about 6 percent for the fiscal year that begins July 1.

"We need to look at restoring some of the very, deep painful cuts we have made," said House Minority Leader Paul Davis, a Lawrence Democrat.

Comments

tolawdjk 2 years, 10 months ago

"Gov. Brownback starts review of tax code"

Why do I picture a scene, the midnight oil burning low, Mr. Brownback tucked in his bed, his nightcap dishelved and askew. The ravishing Mrs. Brownback tucked in her bed (individual twins, seperated by a regulation 2.5 feet, pushed together occaisionally) peacefully sleeping.

Resting upon Mr. Brownback's comforter, a dog-eared copy of the Kansas tax code. His brow furrowed as he hunts diligently for some bone to save the common man. A legal pad and pencil worn to the bone on the night stand to recieve an important thought to pursue at morning's first light.

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Flap Doodle 2 years, 10 months ago

Don't let Charlie Rangel in as a consultant!

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tomatogrower 2 years, 10 months ago

Be afraid. Be very afraid. Especially if you are middle class.

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autie 2 years, 10 months ago

Comparing Kansas to a foreign country like Texas is hardly fair. I think they should eliminate all taxes for everyone making more the 150K and raise the taxes on everybody else. In no time this will stimulate economic growth to the point everyone will be making 150K. Rich don't pay because of loopholes. The poor don't make enough. Go get 'em middle class.

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Dave Trabert 2 years, 10 months ago

I agree we need to eliminate loopholes and other breaks that put government in the business of picking winners and losers but we should use that revenue to lower the burden on others, not spend more.

Kansas Policy Institute looked at the job creation performance of states with the ten lowest and ten highest combined state and local tax burdens. We used the Tax Foundation rankings of states based on 2009 data (the most current available), which shows Kansas had the 19th highest combined burden (before implementing about $500 million in sales, unemployment and property taxes).

Whether looking at the 10-year period leading up to recession or carrying it through 2010, the low burden states dramatically out-performed the high burden states. From 1998 through 2010, high burden states' private sector jobs increased 0.6%; low burden states increased 8.8%. Kansas actually employed fewer private sector workers in 2010 than in 1998. Like or not, jobs and people have been migrating to lower burden states and they will continue to do so.

FYI, Texas has a two-year budget cycle, their budget dwarfs Kansas and much of their deficit (like ours) was the result of stimulus money not returning. Texas increased private sector jobs by 14% between 1998 and 2010. Kansas lost 1.2% of private sector jobs.

Texas students do have lower overall scores on national achievement but a large part of that has to do with a much larger minority population. Kansas has 6.2% Black; Texas 12%. Kansas has 9.3% Hispanic; Texas 36.9%. The National Assessment of Educational Progress shows that both states' performance for those minority groups are about the same on 4th grade Reading tests. Kansas seems to perform better because we have a much 'whiter' population.

Reforming the tax code to reduce the burden is likely the best thing we could do to create jobs and reverse the economic stagnation we've seen over at least the last decade.

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Paul R Getto 2 years, 10 months ago

This would be a good place to start the debate: Here are the research studies commissioned by the legislature on erosion of the tax base: Hugo Wall School of Urban and Public Affairs Wichita State University

http://www.ksrevenue.org/pdf/erosion_property_tax_base.pdf

http://www.ksrevenue.org/pdf/sales_tax_erosion_ks.pdf

75% of the sales and 90% of the property are "off the books." Since we paid for these studies, the legislators and the gov should actually read them. Texas is sometimes held up as a model: Lousy schools in most places; social services at or near the bottom of the scale, approaching 3rd-world status near the southern border; no income tax and a deficit estimated at $27,000,000,000 this year. A fine example of what Muscular Sam wants as Kansas' future?

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weeslicket 2 years, 11 months ago

oh, this is sure to work out well.

but seriously folks, people are leaving this state because of high taxes?? funny stuff, that. (more kool-aide, please. yummy.)

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