Ad Astra per Aspera…To the stars, through difficulty. That is our state motto and nothing could be more appropriate in today’s fiscal crisis.
For more than 1,000 days, the Governor has known the state would be upside down like this and he's done nothing about it. Instead, he and his allies have touted the success of their tax plan and the miraculous way it has turned around the Kansas economy. In the real world, those of us who follow the data and actual numbers know Kansas lags far behind the rest of the US in terms of economic recovery. Our revenues have cratered, and the state blew through an ending balance of more than $700 million in less than two years to cover the shortfalls.
Too many of my colleagues in Topeka bought into this flawed tax policy and now they can’t admit they were wrong. Today was more evidence of that. They want to keep playing favorites, allowing big businesses to game the system while Kansans and small businesses pick up the tab. That’s not what I want and I don’t think that’s what the majority of Kansans want either.
Work Continues
So, here we are on Day 111 of the 2015 legislative session – nearly $1 million over what is budgeted for the legislature – voting on a tax package that balances the budget through smoke and mirrors accounting tricks and short-term fixes while increasing the tax burden on ordinary Kansans. It continues the scheduled income tax rate cuts that have destroyed our revenue stream and have left us with an $800 million hole in the budget. Because HB 2109 only raises $400 million of the $800 million shortfall, this simply kicks the can down the road, leaving our state to face this same financial crisis next year, and the next year and the year after that.
It’s time for people in Topeka to start listening to what taxpayers like us have been telling them all along – we need real revenue reform that doesn’t pit businesses and families against each other. That means a fair, stable and reliable fix that rights the ship and doesn’t just patch a leak.
As the debate came to a head in the legislature this past week, House leadership began to hurl accusations. Blind allegiance was rewarded, but those of us who raised questions about the contents of the bill were ignored. We were asked to compromise, but their definition of compromise meant “vote yes for our plan” not “how can we work together?”
So, what’s in HB 2109?
- Sales tax raised to 6.55%
- Makes KS 5th highest state sales tax in the US
- Food sales tax drops to 4.95%, but not until July 1, 2016
- Cigarette tax raised by $0.50 per pack
- Reduction of all itemized deductions but charitable
- Tax amnesty for delinquent filers
- Income tax rates frozen for 2 years, then continue on the “March to Zero”
- Requirement to have a Social Security number for a full year to claim exemptions (includes new babies) – this impacts poor families claiming the Earned Income Tax Credit
- Tax guaranteed payments on business (something that a simple restructuring will allow business to circumvent)
Here’s the irony: 330,000 businesses will continue to pay zero income tax while their employees foot the bill for the quality-of-life services like schools, roads, and public safety that make Kansas a great place to do business.
Policy
The bill also includes a number of policy provisions which give me even more reason to vote NO:
- Creates a Senate-only commission to eliminate all tax exemptions by 2019, including those for churches, lemonade stands, and Girl Scout cookies. Currently-exempted organizations can appeal to the commission to keep their exemption.
- Caps local revenue increases to 3%, with any overage returned to taxpayers, but without a mechanism to do it;
- Requires local taxing authorities to put tax increases to a public vote if the increase exceeds the rate of inflation;
- The voucher law passed last year was just a stepping stone. It allowed taxpayer funds to help low-income students transfer from Title I schools to non-public schools. This bill removes the Title I requirement and allows taxpayer funds to be spent at unaccredited schools, homeschools, etc.
None of these Band-Aids stop the bleeding caused by the 2012 tax cuts which devastated our state and created the problem we currently face. Until those changes are reversed, I have no intention of subjecting voters to regressive taxes year after year.
