As traditional Republicans, we appreciate and make decisions on fiscal responsibility while running an efficient state government. That is why we both voted against Senate Bill 22, a tax bill that would cut revenue to the state at a time when we are more than $1,500 per capita in debt.
SB 22, the latest tax plan to come through the Kansas Legislature, is packaged and promoted as a bill to address complications created by federal tax reform. Instead it creates a new set of complications — ones that as Republicans we are bound to oppose.
Here is just a handful of the problems it creates:
▪ SB 22 isn’t fiscally responsible in its current form. Schools have been ruled inadequate and inequitable. The foster care system has struggled. Roads and bridges need repaired. Prisons have seen destructive riots. We need resources to rebuild.
▪ Uncertainty around these federal changes remains. Without at least one tax season under the new rules, the true costs and changes in taxpayer behavior are unknown. Estimates are the bill costs a half billion dollars over three years, but it could be more.
▪ The Kansas Association of CPAs has raised concerns that the bill as written would open the door to potential abuses. We have to make sure the state tax department is prepared to investigate individual returns on its own. (The state depended on the Internal Revenue Service for fact-checking and audits.)
Two years ago, the Legislature passed Senate Bill 30, which repealed large parts of former Gov. Sam Brownback’s tax plan. As part of that bill, thousands of small businesses in Kansas — farmers, ranchers, folks on Main Street — went back onto the tax rolls when we ended the LLC tax exemption. We asked them to contribute to balancing our state’s books. SB 22 would change the tax laws again, but not for these small businesses. Instead it benefits the largest corporations in Kansas.
SB 22 would reduce state revenue by $500 million over the next three years, without any plan for making it up. That revenue has already been included in consensus revenue estimates and is important to ensure budget stability as we work to fund schools, repair roads and bridges, and fund public safety.
Pass SB 22 and re-open the “Bank of KDOT,” where we take money intended to repair and maintain our road system. Pass SB 22 and re-open the “Bank of KPERS,” where we take money intended to make retirement payments to state employees.
SB 22 does not promote efficiency. It promotes cuts to roads, education, vital services and public safety.
SB 22 invites a return to the cash-strapped days of the previous administration, when short-term fixes were emphasized instead of structural repairs that would save us money in the long run. We’re still dealing with the consequences of no-bid contracts and the continued rejection of federal funds. We have several more years left in order to recover from bad fiscal policies.
To be sure, there are parts of the proposal that are worth further discussion and investigation.
Decoupling personal income tax filing from federal rules is worth a look. At the same time, we must know more about the burden on the Kansas Department of Revenue and the potential of increased tax avoidance.
We also welcome good-faith discussions on lowering the sales taxes on food and creating a collection mechanism for online sales tax. These are enticing additions to SB 22, but they should be handled separately and not used to attract votes to a bad and complicated piece of legislation.
Bottom line? As Republicans, we support fiscal responsibility. SB 22 isn’t fiscally responsible. We support government efficiency. Taking out a half-billion in revenue would return us to a time when short-term fixes were emphasized over structural repairs. Those repairs save us money in the long run.
This bill does not reflect core Republican values, and it should not become law in Kansas.
Both of us voted against SB 22 when it was in our chambers.
Both of us will vote against overriding a veto.
Jan H. Kessinger represents District 20 in the Kansas House of Representatives. John Skubal represents District 11 in the Kansas Senate.