Half Percent Tax Cut, 100 Percent Gimmick
When I caught wind yesterday that a “deal” was afoot between the Missouri governor and a senator to reduce Missouri’s taxes, I was pretty excited. Yes, the legislature has disappointed us repeatedly before. Yes, the governor has been very bad on the tax reform issue.
But hope springs eternal. So when the “big announcement” came down about the agreement on the tax cut, the response from pro-growth types could be best summarized in one word:
If lawmakers agree to fully fund Missouri’s public schools and rein in spending on the state’s biggest tax credit programs, Gov. Jay Nixon said Thursday he would be willing to sign a tax cut bill.
The framework of a potential deal comes after negotiations with Sen. Will Kraus, a Lee’s Summit Republican sponsoring tax cut legislation. …
According to a release issued by the governor’s office, Kraus intends to put forward legislation reducing the top individual income tax rates by .25 percent effective only after the K-12 foundation formula is fully funded and only after $200 million in revenue growth. The legislation would provide an additional .25 percent reduction effective after legislation is enacted to reduce low income housing tax credits to $110 million annually and historic preservation tax credits to $90 million annually.
If you’re completely not serious about cutting taxes to boost growth, a fraction of a percent cut in one tax might sound like pretty good politics. But in reality? It would do practically nothing in terms of substantive growth, to say nothing of the prerequisite spending that would be necessary for the cuts to take effect. (Which is to say nothing about the illusory tax credit “reform,” which stops short of adequately cutting two hugely wasteful programs and might also leave hosts of other ineffective credits untouched.)
Lots more spending for practically no tax relief? Some deal. Missourians deserve better than a gimmick like this.