That's good, said Coleman, but the corporate income tax also has to go, along with the capital gains tax (actually a part of individual income taxes in the first place.)
It's so easy to cut taxes. But it is so hard to pay for it. I went through this little exercise with Mark Darr the other day, when the lieutenant governor, who apparently plans to announce for 4th District Congress on
tuesday Monday, said it would be a snap to cut 13 percent out of the state budget.
Coleman and Asa raise Darr's ante considerably.
The state raised $6.2 billion in taxes in budget year 2013, which ended June 30.
Of that, exactly half, or $3.1 billion came from the individual income tax. (Based on the most recent figures I have available, in 2009, capital gains taxes amount to a tiny part of that figure, about $35 million.)
Those overtaxed corporations already have plenty of dodges, They contributed only $431 million to the state treasury.
But let's just focus on the individual income tax that Hutchinson and Coleman want to end. 50 percent of the state budget has to go. Or revenue from other sources, most of it the sales tax, must make up the difference, either through a higher rate or an unprecedented jump in the economy.
So back to Coleman and Hutchinson. Where is that $3.1 billion going to come from? The Constitution won't let you take it from the $2 billion education budget. If you take it from the equally huge budget of Human Services, every dollar you cut will mean the loss of three in federal support. OK, you definitely could shut down ALL the state prisons and save $300 million or so. Only $2.8 billion to go.
When Asa and Curtis pull out their Laffer curve napkins, just laugh at them. Ronald Reagan learned that, when budgets must be balanced, you increase tax revenues by increasing taxes, not by cutting them.