Two Things: Perspectives on 0.25%
1. As the Tulsa World reports this morning, voices of reason are starting to emerge in Oklahoma’s Legislature:
Senate Finance Committee Chairman Mike Mazzei said Monday that Oklahoma’s “financial management options” should include suspension of the 0.25 percent reduction in the state income-tax rate that went into effect Jan. 1.
“Given the financial stress the state faces, we should consider a number of financial management options, one of which is a delay in the reduction from 5.25 to 5 percent in the top tax rate,” said Mazzei, R-Tulsa.
Mazzei last week filed Senate Bill 1073, which voids the reduction approved by the state Equalization Board in December 2014 and specifies such a reduction cannot occur in a fiscal year in which a revenue failure has been declared.
SB 1073 also raises the requirements for triggering a rate cut from 5 percent to 4.85 percent.
As those of us who agree with Mazzei keep saying, the tax cut is irresponsible at this time. I’ve heard personally from other legislators who get it.
2. Why wouldn’t you fix part of your problem while you can? Maybe because the Oklahoman says so:
Critics argue the money left in citizens’ hands through tax cuts would be better spent on government. They say increased funding for things such as schools, roads and social services makes a state more attractive to businesses than a low tax rate.
If so, Connecticut should be booming. Instead, since 2010 Connecticut has experienced almost no growth in state gross domestic product.
No doubt, some proponents of higher tax rates will note GE is relocating to Boston. So the company is exiting one high-tax state for another nationally lampooned as “Taxachusetts.” Yet the Tax Foundation ranks Massachusetts’ business climate 25th best in the nation, while Connecticut’s was 44th. In comparison, Oklahoma ranked 33rd.
Clearly, if it’s good for big business, it’s good for the state, right? Just ask all those homeowners in Edmond who are dealing with cracks in their walls. Or maybe ask the drinking water aficionados from Flint, Michigan.
It serves the Oklahoman‘s narrative, though, to frame this as the left wanting to hijack your hard-earned income. Like a Geico commercial, that’s what they do.
I actually agree with the closing paragraph of the editorial, though:
No one should argue that tax rates are the only factor in business location decisions. But it’s a fool’s errand to pretend they’re irrelevant.
It’s true. They also consider the quality of the schools. Schools cost money. That requires some taxation. You can’t have it both ways.
Happy Tuesday, everybody.