Failing the Poor and the Economy, Kansas Gov Signs 'Regressive' Tax Deal
Law will impose $384 million tax hike on sales tax and items most often purchased by low-income earners
Following the end of the longest legislative session in state history, which dragged on an extra 23 days, Kansas Governor Sam Brownback on Tuesday signed a massive budget deal into law that includes a $384 million tax hike—mostly on the poor.
It's the largest tax increase ever introduced in the state, and more than half of it will come from sales tax and cigarette tax, which financial experts have long warned are regressive and punitive for low-income people as they force them to pay a larger percentage of their earnings than someone in a higher bracket.
The deal upholds many of the tax cuts Brownback introduced in 2012, which gave an annual $24,000 windfall to wealthy Kansans—which they will keep—but drove tax rates up for the poorest 20 percent of the state. It also cuts $50 million from the state budget.
Brownback went whole hog to convince lawmakers to pass the deal, including crying and calling legislators from his granddaughter's birth.
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Kelly Davis, midwest regional director at the Institution on Taxation and Economic Policy, explained the deal thusly:
Early on in his tax-cutting frenzy, the Governor offered that Kansas was a “real live experiment” for other states in terms of showing the positive impact of supply side economics. Those words have come back to haunt him and other supporters of trickle-down economic theories. If Kansas is an experiment, Friday’s vote makes it clear that the experiment failed.
...Kansas’s tax changes, even the provision that allegedly exempts 380,000 low-income people from income taxes, will do nothing to alter the fact that the Sunflower State earlier this year earned a spot on ITEP’s “Terrible Ten” list because it has 9th most regressive tax structure in the country.
As the Kansas City Star points out, the higher sales taxes could backfire in border towns, as residents could simply cross state lines to do their shopping in neighboring Missouri, where the food tax will soon be five times lower.
The move is part of a trend of Republican-led states pushing tax schemes that exclusively benefit the rich and exclusively burden the poor.
The budget becomes law just months after Brownback signed into a law a controversial welfare bill that places strict limits on benefits and how they may be spent.