Arkansas Advocates: Hutchinson tax plan omits poorest workers | Arkansas Blog

Friday, January 23, 2015

Arkansas Advocates: Hutchinson tax plan omits poorest workers

Posted By on Fri, Jan 23, 2015 at 11:59 AM

click to enlarge taxes.jpg

Arkansas Advocates for Children and Families
has issued a statement calling Gov. Asa Hutchinson's income tax proposal a step in the right direction, but lamenting its omission of the lowest income taxpayers from benefits. Said the Advocates:

The proposal maintains some small marginal tax breaks for those at the bottom (who make less than about $17,000 a year) that were already passed in 2013, but there is nothing new in the bill that would help low-income Arkansans. Workers at the bottom of the ladder pay about twice the tax rate of the richest people in our state as a percentage of income, and have benefitted the least from the current economic recovery.

The statement welcomes the tax break for middle income earners. And it also applauds the repeal of the capital gains tax, a boon to the wealthy that will be taken back this year. But tax cuts have consequences, the Advocates note.

By law, Arkansas has to pass a balanced budget. This means we have to pay for the loss in revenue either by either slashing program budgets or by finding another way to raise the money. This revenue loss comes at a time when the state is already underfunding a range of critical programs that are important to the state’s economic future and to children and families: the state’s ABC pre-K program, community-based rehabilitation programs for juvenile offenders, child welfare case workers and investigators, poverty funding for low-income students, higher education, and improvements to infrastructure like highways and roads. Ideally, the legislature will offset this loss by raising new revenue through other parts of the Arkansas tax system, rather than relying on budget cuts or using one-time funds. But no plans to do so have been announced. AACF will issue a report on responsible revenue raising ideas for the Arkansas state budget in the coming days.

In several ways, this plan is a move toward a more equal and fair Arkansas. However, we should be cautious not to take one step forward and then two steps back. Legislators and advocates should be wary of “Gateway” tax cuts that could lead to bigger, more irresponsible cuts for the wealthy down the road. 

I've asked the governor's office for a comment on the omission of the lowest income. The thinking has been that the state provides for low-income taxpayers in other ways — nutrition and health assistance, for example.

It's uncertain if it will occur this session, but I have been told by Republicans that further incentives for higher end payers could be in the works, though they might be in the form of incentives for concrete development investment. There's also talk circulating of an earned income tax credit on the state level, though perhaps paid in a way that could be used only for health care, say.

Tags: , , , , ,

From the ArkTimes store

Favorite

Comments (3)

Showing 1-3 of 3

Add a comment

 
Subscribe to this thread:
Showing 1-3 of 3

Add a comment

More by Max Brantley

Readers also liked…

  • LR speakers blast state board for double standard

    A series of speakers, beginning with Sen. Joyce Elliott, denounced what they saw as a hidden agenda favoring charter schools at the state Department of Education and asked the state Board of Education for return of local control.
    • May 12, 2016
  • Police identify two women found fatally shot on Chicot Road

    Little Rock police have identified two women found dead of gunshot wounds in an SUV parked next to a vacant trailer in a mobile home park at 11500 Chicot Road.
    • May 16, 2017
  • Saturday's open line

    Got any thoughts? Put them here.
    • May 21, 2016

Most Shared

  • Industrial hemp pilot program coming soon to Arkansas

    One of the booths at this week's Ark-La-Tex Medical Cannabis Expo was hosted by the Arkansas Hemp Association, a trade group founded to promote and expand non-intoxicating industrial hemp as an agricultural crop in the state. AHA Vice President Jeremy Fisher said the first licenses to grow experimental plots of hemp in the state should be issued by the Arkansas State Plant Board next spring.

Most Viewed

Most Recent Comments

  • Re: The aftermath of Alabama

    • I'm still not hopeful. Even with all the positive framing of the situation in the…

    • on December 13, 2017
  • Re: The aftermath of Alabama

    • No one should forget the role played by Republican Senator Shelby in the defeat of…

    • on December 13, 2017
  • Re: The aftermath of Alabama

    • Moore said he wont concede and that he must wait on God to check the…

    • on December 13, 2017

Blogroll

 

© 2017 Arkansas Times | 201 East Markham, Suite 200, Little Rock, AR 72201
Powered by Foundation