Archive for Friday, February 1, 2013

Democrats decry Brownback tax plan; Republican leader says it may get altered

February 1, 2013


— Kansas Democratic leaders on Friday warned that Gov. Sam Brownback's proposed second round of income tax cuts would put state finances in a crisis for years to come.

The non-partisan Kansas Legislative Research Department, which provides staff work for the Legislature, showed that the plan by the Republican governor would produce a budget shortfall of $781.5 million within five years. Current state spending is about $6 billion per year.

"This just demonstrates that the state of Kansas simply cannot afford the massive tax cuts that the governor is proposing, and he clearly wants to go much further," said House Democratic Leader Paul Davis of Lawrence.

Republicans downplayed the deficit projection, although they also indicated Brownback's proposal would be altered.

"This may not pass," said House Speaker Ray Merrick, R-Stilwell. "It may not be the solution, but we have to get out of here with a solution," Merrick said.

Merrick said he has directed budget and tax committees to work on alternatives, but he said he hadn't heard of any proposals yet.

Merrick described the Legislative Research deficit projection as "static" and said it doesn't take into account economic growth that he believes tax cuts will prompt. He also said he believes more state spending could be cut.

Senate Democratic Leader Anthony Hensley of Topeka said Republicans who dismiss the Legislative Research figures are "in a state of denial."

Davis said the notion that tax cuts would drive economic growth is "just more of this Washington D.C. supply-side economics that has failed over and over again."

Brownback has proposed lowering personal income tax rates over three years with elimination of the income tax as the ultimate goal.

To balance the budget, he wants to eliminate deductions available to homeowners on mortgage interest and real estate taxes. He also wants to keep the state sales tax at 6.3 percent, instead of allowing it to drop to 5.7 percent in July, which is what the law currently states. And Brownback has proposed the transfer of $245 million in highway funds over two years to help finance public schools.

Last year, the governor signed into law cuts in income tax rates and the elimination of income taxes for the owners of 191,000 businesses. The package also did away with several tax credits aimed at helping poor Kansans, such the food sales tax rebate.


just_another_bozo_on_this_bus 5 years, 4 months ago

"Merrick described the Legislative Research deficit projection as "static" and said it doesn't take into account economic growth that he believes tax cuts will prompt. He also said he believes more state spending could be cut."

If there is going to be economic growth in Kansas, it's going to happen as a result of national economic growth, and that growth is going to be hindered by austerity hysteria, not promoted by it. But he's right-- the Legislative Research deficit projection may be inaccurate because it's static-- it doesn't take into account that the economy will spiral downward because of austerity hysteria, and the deficit would then be much greater than $781.5 million within five years.

chootspa 5 years, 4 months ago

Wasn't there a model last year that did question how much growth it would take to make up for the lost revenue, and the answer was something astronomically high?

jafs 5 years, 4 months ago

I don't know about that, but you can figure it out logically.

Given tax rates, any cuts would have to generate multiple amounts of those cuts in growth to generate the same amount of revenue.

It's possible, but highly unlikely. Even Laffer doesn't claim tax cuts raise revenue, or even break even.

Richard Heckler 5 years, 4 months ago

"Republicans downplayed the deficit projection, although they also indicated Brownback's proposal would be altered"

MORE BS beyond belief. Brownback does not give a hoot for other republicans nor is he going to sign off on any alteration. His and ALEC's agenda is all that matters. If Brownback must exert executive privilege to get his way he will do so.

Brownback and ALEC have no use for republicans or democrats..... only their agenda.

DScully 5 years, 4 months ago

BS by the SB. If down the road he actually manages to eliminate the income tax, all hell will break loose!! Property taxes will go sky high, and that includes on renters, who have property taxes on the buildings they live in come out of their rent. Ergo, rents will soar. The SB is evil, no 2 ways about it!!!

bad_dog 5 years, 4 months ago

Ladies and gentlemen, next up on the Kansas legislative budgetary guillotine agenda: The Kansas Legislative Research Department. Surely private sector economists can do a better job with their projections and probably for less money, too. Perhaps there's someone in Wichita or Florida that can help...

DScully 5 years, 4 months ago

We need a good tornado to scoop him up and drop him where the sun don't shine....

Jean Robart 5 years, 4 months ago

I wish I had know how he would operate before the election. I never would have voted the way i did. I am so glad i am moving out of Kansas in another ten days.

Thinking_Out_Loud 5 years, 4 months ago

Well, that's fair. Yet last August and last November, I think it is fair to say the Governor's philosophy, approach, and agenda were clear. Knowing those things, Kansas voters still decisively gave legislative power to the conservative faction of the Republican party. In other words, Kansas is getting exactly the government it knowingly voted for.

Whether we will maintain the quality of life we have previously enjoyed, though, remains to be seen. Personally, I believe that we will not. I expect us to experience lower qualities of education, highway, consumer protection, and to experience more keenly than ever the social effects of poverty and poor public health. To support the policies we are implementing now we will have to dismantle the infrastructures needed to manage those services--meaning if we change our minds in five or six years, we will be unable to reverse what we have done, here.

Nonetheless, we have done it. Our only real option, now, is to roll up our shirtsleeves and work through our churches, synagogues, and social clubs with public service missions to pick up the pieces.

James Nelson 5 years, 4 months ago

Isn't it true that the number of church faithful is dropping? How is a shrinking number going to pick up an ever growing need like what the state is sloughing off?

Katara 5 years, 4 months ago

It is humorous to see someone with another state's name in their username tell people to leave Kansas.

Paul R Getto 5 years, 4 months ago

He is doing what he said he would, discounting the lies about protecting the poor and the schools.

Mike1949 5 years, 4 months ago

We allowed? I don't think so. The people tired of loosing their freedoms have been screaming about brownback ever since the corrupted republican party put him into office! I all have heard is if I don't like it, get out! (seriously) So much for democracy!

TongiJayhawk 5 years, 4 months ago

"the corrupted republican party put him into office! " I vaguely remember there was an election and he won by a wide margin. That is democracy! You have an election and someone wins. I'm not thrilled about Obama winning, but the people spoke and I'll deal with it! One of the great things about state rights is they don't have to completely follow the Federal Government.

just_another_bozo_on_this_bus 5 years, 4 months ago

The margin of his victory doesn't change the rules of math, or reverse the massive deficits that are coming down the pike.

James Nelson 5 years, 4 months ago

So, you admit you left Kansas because the republican party, who have governed Kansas forever, set the three taxes you mentioned unfairly high. It might take two or three years but if you decide to move back you won't believe how high property taxes will skyrocket if Sammy boy gets his wish on income taxes.

You must think also that the greedy, selfish, dictatorial ilk like the Koch brothers are the only hardworking, smart people around. I can only feel sorry for people like you with such thoughts.

JackMcKee 5 years, 4 months ago

The problem with your statement is that taxes aren't going down, they are shifting. If they do actually decrease it will come at the cost of education and social services. In that case, lookout Mississippi, we're gonna whip you in the race to the bottom.

dabbindan 5 years, 4 months ago

and now the portion/proportion the poor pay with income tax is higher, while the higher income portion has shrunk. when this was pointed out to sam he countered that the social services net would be enhanced to help with that. hmm. what do the low income earners need most to get out of the low income situation? certainly not less income and more social services. that's supposed to be the leftist trap isn't it?

pathetic man, that sam brownback. some of us could be motivated to leave the state out of embarrassment alone.

Paul R Getto 5 years, 4 months ago

Hope it's not as bad as I think that it's going to be .

I share your optimism but it will get much worse.

just_another_bozo_on_this_bus 5 years, 4 months ago

The Richest Pay Half The Effective Tax Rates Of The Poor In State And Local Taxes

January 30th, 2013 11:54 am Jason Sattler

"Trickle-down economics has trickled down to the states.

Virtually every state in the union takes a greater share of income from working families than the rich, according to a new report from the Institute on Taxation and Economic Policy (ITEP).

The report’s stark conclusion finds that state and local tax rates are “fundamentally unfair,” creating a hindrance to economic growth for the middle class that has been exacerbated by states moving away from progressive income taxes and toward consumption taxes.

“There’s a good chance it’s the so-called ‘takers’ who spend so much on necessities that they pay an effective tax rate of 10 or more percent, due largely to sales and property taxes,” Matthew Gardner, executive director of ITEP and an author of the study, said.

Texas, which is often called the “low tax state,” ranks among the states that have the highest taxes on the poor.

The bottom 20 percent pays 6 times the rate of the richest in Washington State, Florida, South Dakota, Illinois, Texas, Tennessee, Arizona, Pennsylvania, Indiana, and Alabama. ITEP called these states the “Terrible Ten” Most Regressive States.

Deductions and the practice of taxing capital gains at a lower rate make state tax codes more regressive. Policies like the earned income tax credit, which Michigan Republicans just cut, make the code more progressive, but only exist in 24 states and the District of Columbia.

Even where states do have progressive income tax rates, they’re effectively shaped to put the burden on working families. “Alabama is a good example of a state with nominally graduated income tax rates that don’t mean much in practice,” the report states. “The state’s top tax rate of 5 percent is not much lower than Louisiana’s top rate — but the top rate kicks in at just $6,000 of taxable income for married couples. ”"

RibMan 5 years, 4 months ago

The KS unemployment rate is approximately 5.5%. The national average is 7.9%.

Our economy is strong and positioned to become stronger.

States with no income tax (Florida, Texas, Tennessee, for example) tend to grow faster, create more jobs and have fewer people depending on government for their existence.

The gloom and doom comes from high tax States like California.

Facts are stubborn things. This is a debate worth having. Let's look at other States and study their experiences before declaring defeat. So far, it appears those States that move to lower income taxes do a better job of balancing their budgets and create more and better jobs. Which, of course, leads to a broader and deeper tax base.....which keeps governments operating.

George_Braziller 5 years, 4 months ago

Brownback needs to re-take Budgeting 101. When writing a budget you always over-estimate expenses, under-estimate revenue, and never include theoretical "maybe" money.

The organization where I used to work had a $1 million reserve but is now almost bankrupt because the ED wrote a deficit budget that ate up most of the reserve and made it balance by including revenue from a grant that not only hadn't been awarded, had not even been submitted. Within two years there were three rounds of layoffs, most of the services were been eliminated, and the staff has been cut by 75% from when I worked there.

Brownback is doing the same thing.

JayhawkFan1985 5 years, 4 months ago

Hallelujah, Merrick "believes" state spending can be further cut. It must be nice to have blind faith. I wonder how much time Merrick has spent at state agencies visiting with people who actually know how long the lines are, how many potholes there are, how many kids are in each classroom, etc. unfortunately for me, I have eyes, ears and a brain and know that. There is no meat left on the bone. Any further cuts will excise bone tissue.

The GOP is like the scarecrow...if they only had a brain...

Commenting has been disabled for this item.