One of the fallacies in the debate about taxes is considering various elements in silos instead of in full packages as they are actually experienced by working Kansans.
By NICK JORDAN
Special to The Star
For a decade, Kansas had a stagnant economy, so we have been working diligently since 2011 to turn that around and offer a better life to our fellow citizens. Indeed it is Gov. Brownbacks concern for the well-being of all Kansans that guides his policies to increase families net income and boost private-sector job creation to benefit everyone.
Many Kansans want a fairer, flatter, simpler tax system, and they have elected a governor and legislators who are finally doing something about it.
With those taxpayers in mind, Gov. Brownback and the legislature have taken action the last three years to jump-start the states economy by reforming and streamlining an overly complicated tax code that was cobbled together over many decades.
Kansans will pay significantly less in taxes in 2013 than they did in 2012, and the savings will grow from there, even as the state spends billions annually on core responsibilities such as education, roads, and Medicaid.
In addition to reductions that took effect at the start of this year, which lowered income tax rates by 14 percent to 24 percent for all Kansas taxpayers, taxes will continue to decrease.
Starting July 1, the state sales tax rate will drop from 6.3 percent to 6.15 percent. Income tax rates will continue decreasing to 3.9 percent for the upper bracket and 2.3 percent for the lower bracket in 2018.
Standard deductions for single, head of household tax filers and those married and filing jointly have also increased compared to 2012.
Critics contend this tax relief somehow harms low-income Kansans, but you must look at the full package.
Besides lowering taxes for low-income taxpayers in Kansas, this bold action will grow the states economy, and that happens to be the best way to help low-income Kansans get better jobs and increase their family incomes.
The reality is that 25 percent of Kansas tax filers already pay zero state income tax. Their taxes cant be lowered any more than that.
When it comes to compassionate assistance to the poor, it is also imperative to remember the full range of government benefits provided rather than one item in isolation. Low-income and disabled Kansans receive more than $3.5 billion in assistance annually through programs already in place, forming a sizable safety net. This year, the Legislature put in a food sales tax credit for low-income families that would provide up to $500 tax credit for a family of four making $30,615 or less, compared to an average refund of $145 under the old program.
Last year, for example, more than $469 million was provided in food assistance, benefiting an average of 316,000 people per month. The state also provides unemployment benefits, and federal programs such as housing assistance are available on top of other welfare programs. And while most states, including Missouri, do not offer a state-funded earned income tax credit (EITC) in addition to the federal EITC, low-income Kansans receive more than $90 million per year from the state EITC.
A fixation on raising taxes and growing government is not the solution. The core debate in D.C., or the states, is what strategy best grows the economy, more government spending or letting the private sector and families keep more of the money they earn.
While we need to find a proper balance in providing services through government programs, the best economic growth strategy is the private sector entrepreneurship and innovation that has made our country great.
Nick Jordan of Shawnee is secretary of the Kansas Department of Revenue.