Tuesday, August 7, 2012

Republicans dodge questions on their tax plan

Posted By on Tue, Aug 7, 2012 at 10:51 AM

The Arkansas Republican Party has put itself in a bind — if any voters were paying attention.

It has vowed to end the state income tax and replace it with a "more equitable" method of taxation.

But it steadfastly refuses to say what that "more equitable" system would be. Several Republicans have expressed a preference — as draft GOP platform language also did — for a higher sales tax. But the party is distancing itself from that idea for the moment. Of course. It would punish the poor and middle class while the wealthy received a windfall from ending the income tax. Not a great election season message.

Will anybody hold the Republican Party accountable for this cake-and-eat-it-too pipedream of a tax platform? The Arkansas Democratic Party is trying with the following recitation, including a Talk Business interview in which the Republican spokesman, Katherine Vasilos, dodged every effort to make her come clean on the Republican tax plan.

What is the "equitable" tax planned by Republicans? Voters deserve an answer.

DEMOCRATIC PARTY NEWS RELEASE

Arkansas Republicans Unable to Answer to Their Plan on Taxes
Hard-working Arkansas Families Hit Hardest By “Equitable Tax System”

(LITTLE ROCK) Arkansas Republicans refused to provide any answers about their plan to raise taxes Sunday night, causing Arkansans to question exactly which tax Republicans would increase by replacing the state income tax with an “equitable tax system.” Previously, the GOP had said they would raise the state sales tax.

“Republicans are only interested in distracting Arkansans from their dangerous plan to increase taxes for every Arkansan, except for the most wealthy,” Candace Martin of the Democratic Party of Arkansas said. “While Republicans refuse to answer exactly what their ‘equitable tax plan’ looks like, Arkansas Democrats believe that a tax increase is not in the best interest of Arkansas families.”

A fact check with the transcript and the full video on this exchange can be found below.

BACKGROUND

* Republican spokesperson falsely says that “there is no plan out there” for Republicans to raise the state sales tax to pay for income tax cuts. Earlier this year, a Republican legislator announced that he had “already drafted a bill that would phase in income tax cuts and sales tax increases over the next three fiscal years.”
(“House Republicans unveil agenda for 2013 session”, Arkansas News, 4/5/2012)

* Republican Party of Arkansas platform vows to “replace the state income tax plan with a more equitable method of taxation.” The Republican plan acknowledges that they oppose income tax increases and corporate income taxes, but leave increases for other taxes, like the state sales or the gas tax on the table. (2012-2014 RPA Platform)

* When pressed for specifics on potential tax increases under the Republican tax plan, Republican spokesperson refused to answer the question. During an interview with Talk Business, a question was posed that “if you’re going to reduce the income tax, then you’re going to have to raise another tax, which is what your challenge just was.” The Republican spokesperson chooses not to answer what an equitable tax system looked like. (YouTube video, 8/5/2012)

* Republican leaders have advocated for a flat tax system which would increase taxes for Arkansas families. While running for office in 2010, Lt. Governor Mark Darr, President of the State Senate and the highest-ranking Republican state official, “told reporters he favors establishing flat sales taxes on both the federal and state levels. ‘To me that puts the taxes in your hands. You can decide how much taxes that you are going to pay by the goods and services that you buy,’ he said.” (Arkansas Democrat-Gazette, 10/13/10)

Transcript of exchange on Talk Business interview:

Roby: Let’s turn our attention to a controversy that erupted this past week between the two of you actually. It was a little controversy over Democratic assertion that Republican want to raise sales taxes in this state as a balance for a cut in the income tax. I’m going to grant you the premise of your argument, but there has to be some balance. But would you admit that it’s not in the party platform - this raising sales tax plank — that you had out there in your original press release.

Candace: The language that they adopted as part of their party platform is actually worse from what they had in there previously. Previously, they said that they would cap the state sales tax increase by two percent. There’s already one Republican plan out there that says they would increase it by three percent. Now, they are just saying that they would replace it with an “equitable” tax system, and I have no idea what that looks like or what kind of tax hikes are in there. And more so, Arkansas families are concerned about how it is exactly it is that Republicans want to pay for their plan — whether that’s through sales tax increases or other tax increases.

Roby: Okay the language is not in there, but there is language in there about an “equitable” method to balance this out. What does that mean?

Katherine: Well, first I want to say that Arkansas Democrats are wrong on the facts. There is no plan to raise the sales tax in Arkansas. In fact, I brought with me a copy of our party platform as well as a copy of our House SIMPLE plan. If you can find anywhere in these two documents where Republicans want to raise taxes, then I will personally make a donation to the head of the Democratic Party, President Barack Obama.

Roby: Well I would point out that the language in the platform says “replace the state income tax with a more equitable method of taxation.” If you’re going to reduce the income tax, then you’re going to have to raise another tax, which is what you’re challenge just was.

Katherine: Bottom line is that our income tax is unfair. It puts our state at a disadvantage with surrounding states when it comes to job creation. Republicans have a plan to reform our income tax in Arkansas. You can read the details of that plan online — It’s called the SIMPLE plan at arhouse.org. Read that online; it’s for every Arkansan to see. But again, Republicans do not want to raise the sales tax. There is no plan out there. I’ve presented these two documents. Again, you can review them. There is nothing in these two documents that says “Republicans want to raise taxes on Arkansans.”

Roby: Katherine has spoken. She says there is no language in there that says that.

Candace: Well, I would like to have some more information from you about what an “equitable tax system” looks like. If it’s not an increase in the state sales tax as your party has previously proposed, it is a flat tax? Is it an increase in the gas tax? All of those things would be detrimental to Arkansas families and it’s not in their best interests. Arkansas Democrats, on the other hand, have a record of cutting taxes in our state. We’ve cut more taxes than in our entire states history and delivered over $245 million every year back to Arkansas families through tax cuts like the grocery tax cut. We want to continue that kind of progress.

Roby: Go ahead Katherine.

Katherine: You know you speak of the grocery tax cut. Governor Mike Beebe was able to reduce the grocery tax cut, and Arkansas Republicans believe that we can reduce the income tax. It’s a matter of priorities. We either grow government or we reduce taxes, and Republicans support reducing the tax burden on hard-working Arkansas taxpayers.

Watch the full exchange here.

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