Rally in Wichita embraces new GOP tax-cut plan

About 40 people, including the state’s presumptive next governor, rallied for tax cuts at a north Wichita construction business Thursday.

The event was part of a national bus tour by a group called Job Creators Network, which is criss-crossing the nation pushing for federal tax reductions for closely held businesses.

The tour stop coincided with Thursday’s release of the Republican tax plan in Washington, which the participants quickly embraced.

Among the speakers was Susan Estes, the wife of U.S. Rep. Ron Estes, who has said he sees tax cuts as a major priority for Congress.

Susan Estes said small closely held businesses can pay a higher tax rate than business giants such as Google and Facebook.

“We have got to get this tax cut through,” she said. “Let me hear an ‘amen’ if you get it.” The crowd responded with an “amen” and applause.

The GOP plan would cut the corporate tax rate from 35 percent to 20 percent.

It also would reduce the tax rates paid by the owners of “pass-through” businesses, such as limited liability companies.

Those companies don’t pay taxes, but profits that flow through to the owners are taxed as part of their personal income.

Under the Republicans’ plan, the tax rate on the highest pass-through earnings would drop to 25 percent, down from the current 39.6 percent.

On pass-through income, the Republicans’ national tax plan resembles the plan enacted by the Kansas Legislature at Gov. Sam Brownback’s urging in 2012, though it doesn’t go quite as far.

The Kansas law eliminated state income tax on pass-through profits, based on Brownback’s theory that business owners would use their extra money for expansion and employee raises, creating overall economic growth that would offset lost tax revenue.

However, the economic growth was not as robust as the governor and Legislature forecast, leading to annual state budget deficits in the hundreds of millions of dollars. This year, the Legislature overrode a Brownback veto and repealed the pass-through tax break.

Lt. Gov Jeff Colyer, who is expected to replace Brownback as governor soon, was among the speakers at the bus rally and called Thursday “a very auspicious day.”

“We’re excited that it (the Republican tax plan) has been released,” Colyer said. “When you talk to Kansans, when you talk to Americans, they are concerned. They want to grow. They want better jobs. They want better paying jobs. They want a future for their kids, and that’s what this is about.”

Colyer noted that the unemployment rate in Kansas is now 3.7 percent, the lowest unemployment since 2000.

“We need to grow our economy, we need better jobs, we need more capital investment right now. Putting money back in people’s pockets allows that to happen and we’re going to continue to do that. That’s our goal.”

Colyer said tax cuts inititated by presidents Kennedy and Reagan led to robust economic growth in the 1960s and ‘80s and predicted that cuts now would do likewise.

“That is part of the magic of what makes America great,” Colyer said. “And I think we need to make sure that that lesson now comes forward for us.”

“I think it will go very well,” he said of the GOP tax plan. “We need to grow the United States of America.”

Brownback has been appointed to an ambassadorship by President Trump and Colyer is expected to ascend to the state’s top office following Senate confirmation of Brownback’s nomination.

The Job Creators Network was started by billionaire Bernard Marcus, co-founder of the Home Depot building supply chain.

Phil Willard, the chief operating officer of the group, said Marcus sees the group as the voice of small business for those without the money to pay Washington lobbyists.

“A lot of people may say Home Depot, that’s a mega corporation,” Willard said. “But it was a small business when it first started.”

He said Marcus, now 88, has said he would not have been able to start Home Depot if current taxes and regulations had existed in 1979.

The Job Creators Network had hoped for an even deeper cut in the pass-through income tax rate, to 15 percent, but is happy to support the plan to cut it to 25 percent, Willard said.

Thursday’s Wichita stop, at the Conco Construction company, followed a stop in St. Louis. The bus tour continues Friday in Denver.

This story was originally published November 2, 2017 at 2:59 PM with the headline "Rally in Wichita embraces new GOP tax-cut plan."