Editorials

Tax cut is huge gamble

Clarification: The $2.4 billion state budget shortfall projected by 2018 is a cumulative total over five years. Taxes generated from new jobs would not have to offset this shortfall in one year.



As the Legislature finally adjourned Sunday, House Speaker Mike O’Neal, R-Hutchinson, said that “everybody’s just going to be amazed” by the results. “Appalled” is more like it.

True, many businesses big and small will rejoice, because they’ll be newly spared from paying state income tax on nonwage income if Gov. Sam Brownback signs a massive tax cut into law. Individuals filers will see their tax bills go down, too.

“It will leave $1.5 billion in Kansans’ pockets during the next two years,” Brownback said Sunday.

But the joy promises to be short-lived and unevenly shared, unless the nonpartisan legislative researchers somehow are wrong and the anti-tax preachers running the state are right.

As tax collections slow, according to the researchers, a budget gap could open up and, if unchecked, grow to nearly $2.4 billion by 2018.

And, of course, it won’t go unchecked.

Deficit spending may be tolerable in Washington, D.C., where government can borrow what it needs to pay bills. But the Kansas Constitution demands a balanced budget every year.

And because raising taxes is such a rarity in Topeka, future legislatures will see cutting as their only option – affecting schools, social services, road construction and much, much more.

Brownback, O’Neal and the other proponents of this extreme makeover of the state’s tax policy have had their fingers in their ears all spring, answering the doubters by restating their faith in the power of tax cuts to cure all ills and make everything grow.

While faithful Republicans can argue whether the aggressive tax cuts of the Reagan and Bush eras led to anything but massive federal deficits, it’s hard to see Kansas’ pending tax cuts leading to anything but massive reductions in essential state services and increased property taxes at the local level.

Even if Brownback’s Department of Revenue and its “dynamic scoring” are correct about the state adding 23,000 new jobs by 2020 because of the tax cuts, each job would have to generate more than $108,000 in sales taxes and income taxes in a given year to offset the shortfall created by the tax cuts.

We’d say “good luck with that” – except all Kansans are along for this huge gamble.

For the editorial board, Rhonda Holman

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