Eagle editorial: Sales tax is least-bad option

05/29/2013 5:27 PM

08/08/2014 10:17 AM

It is understandable that Kansas House members are balking at raising taxes. But the state’s budget problems will only get worse without more revenue – particularly when the state likely will lose a school-funding lawsuit.

So as painful as it is, House lawmakers should approve at least a partial extension of the statewide sales tax. Then they should blame Gov. Sam Brownback, who created this mess when he approved unaffordable tax cuts last year.

House members thus far have resisted pressure from Brownback and the Kansas Senate to make permanent the state’s temporary sales-tax increase. They are correctly concerned about breaking a promise to taxpayers and about the impact on low-income Kansans.

But the reality is that the 2012 income-tax cuts are putting the state in a deep budget hole. Revenue estimates released this spring projected that the state will lose nearly $1 billion of revenue over two years, mostly due to the tax cuts and the scheduled reduction in the sales-tax rate.

Though the state could spend down its ending balance and maybe make it through next fiscal year, that would leave it in even worse financial shape the year after that. And cutting state spending that much is not realistic or desirable.

Also, state budget projections assume no significant funding increases for K-12 public schools. But a Shawnee County District Court panel already ordered the state to increase school funding by at least $440 million. The Kansas Supreme Court is expected to rule on the case later this year or early next year, and there’s little reason to think it will let the state off the hook.

The best course of action would be to reverse course on some of last year’s reckless tax cuts. But given that Brownback would veto any such move, lawmakers need to look at other options, such as extending the sales tax and eliminating some income-tax deductions.

House members, particularly the freshmen lawmakers, don’t like being backed into this corner. As Rep. Blaine Finch, R-Ottawa, a leader of the freshman caucus, complained: “We were not in the building last year when the tax plan was passed without the ‘pay-fors’ that are now so hard to find. It was not us who promised the public a temporary sales tax that we are now told needs to be made permanent.”

But Brownback has left lawmakers with only bad options. And the least-bad option is extending the sales tax.

For the editorial board, Phillip Brownlee

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