Governors, the way to sell elimination of the State Income Tax to everyone - a State FAIRtax
State governors know that:
- States compete to keep existing businesses in their state and attract businesses and people to their state.
- Tennessee, Texas, and Florida have no state income tax and have rapidly growing economies. They are attracting businesses and workers into their states.
- Elimination of the state income tax attracts more people and business to their state and create more prosperity for everyone in their state.
- Economists agree that economies grow faster when consumption, not income, is taxed.
- 17 states have cut their state income or corporate taxes in 2023.
States that reduce their state income tax rates often try to replace the lost revenue by increasing their state’s retail sales tax rate. Unfortunately, that’s a less than ideal solution because sales taxes as currently implemented are decidedly regressive.
Lower income earners spend a much higher percentage of their income on retail purchases than wealthy people do, and taking the same percentage from everyone hurts the poor a lot more than it hurts the rich.
A report was issued by the Institute on Taxation and Economic Policy.
The report stated:
Lower income earners spend a much higher percentage of their income on retail purchases than wealthy people do, and taking the same percentage from everyone hurts the poor a lot more than it hurts the rich.
A report was issued by the Institute on Taxation and Economic Policy.
The report stated:
- Ten states — Florida, Washington, Tennessee, Pennsylvania, Nevada, South Dakota, Texas, Illinois, Arkansas, and Louisiana — are particularly regressive, with upside-down tax systems that ask the most of those with the least.
- These states tax their poorest residents — those in the bottom 20 percent of the income scale — at rates averaging three times higher than those charged to the wealthy.
- Middle-income families in these states pay an average rate more than twice as high as a share of their income than the wealthiest families.
- Florida, which has the most regressive state tax system in the nation, fares worst by these two measures, with low-income families paying almost 5 times more than the wealthy and middle-income families paying more than 3 times more.
CONCLUSION
The governors and state legislators cutting their state income taxes are confident that this will result in benefits to their states. They see how well neighboring states with no state income tax are prospering and attracting new businesses.
But there is a problem. When sales taxes are increased to offset lower income tax rates, the lower income residents of their states are the ones who bear the brunt.
Lower income people must take care of their families today. While the promise of higher paying jobs in the future sounds good, that doesn’t help the families who are struggling to make ends meet today. Consequently, most lower income people vote for those candidates who oppose cutting state income tax rates and raising state sales tax rates.
How do state governors communicate to these lower income people that they will not suffer if state income tax rates are cut?
There is an easy solution:
The governors and state legislators cutting their state income taxes are confident that this will result in benefits to their states. They see how well neighboring states with no state income tax are prospering and attracting new businesses.
But there is a problem. When sales taxes are increased to offset lower income tax rates, the lower income residents of their states are the ones who bear the brunt.
Lower income people must take care of their families today. While the promise of higher paying jobs in the future sounds good, that doesn’t help the families who are struggling to make ends meet today. Consequently, most lower income people vote for those candidates who oppose cutting state income tax rates and raising state sales tax rates.
How do state governors communicate to these lower income people that they will not suffer if state income tax rates are cut?
There is an easy solution:
- A state version of the FAIRtax with a prebate up to the poverty level.
- The prebate exempts purchases up to the poverty level for the family unit from the state sales tax and changes the state sales tax from a regressive system to a progressive system.
- Lower income people see an immediate increase in their ability to purchase the items their families need.
Now state officials can get the support of a demographic in their state that they have not been able to reach up to now.
On the national level, the FAIRtax is the answer! It is a system:
On the national level, the FAIRtax is the answer! It is a system:
- That is so simple everyone can understand it.
- That shows the costs of the federal government on every retail receipt so all of us understand what we are paying.
- That helps U.S. companies compete with foreign competitors.
- That keeps jobs in the U.S. rather than exporting them to other countries.
- That permanently establishes the solvency of Social Security and Medicare.
- That eliminates special treatment for any group of taxpayers.
- THAT IS THE LARGEST TRANSFER OF POWER FROM D.C. TO THE PEOPLE SINCE THE CONSTITUTION WAS ADOPTED.
D.C. is ignoring the one real solution that allows us to remain citizens and not subjects, the FAIRtax. The FAIRtax is simple, non-invasive, but most of all, IT WORKS!
THE SOLUTION—PASS THE FAIRTAX!
The FAIRtax transfers power from Congress and the bureaucrats to the people. We, not D.C., decide how much federal tax we pay.
Join us and TAKE BACK CONTROL OF OUR COUNTRY AND OUR LIVES—NOT WITH BULLETS BUT WITH THE ELIMINATION OF ONE OF THE BIGGEST THREATS TO OUR LIBERTY AND ECONOMIC PROSPERITY—THE INCOME/PAYROLL TAX.
We all should remember Edmund Burke’s warning that applies to our efforts to TAKE BACK CONTROL,
“Nobody made a greater mistake than he who did nothing because he could do only a little.”
Please go to this link to invest in AFFT and your country. It’s an investment in your and your family’s future.
THE SOLUTION—PASS THE FAIRTAX!
The FAIRtax transfers power from Congress and the bureaucrats to the people. We, not D.C., decide how much federal tax we pay.
Join us and TAKE BACK CONTROL OF OUR COUNTRY AND OUR LIVES—NOT WITH BULLETS BUT WITH THE ELIMINATION OF ONE OF THE BIGGEST THREATS TO OUR LIBERTY AND ECONOMIC PROSPERITY—THE INCOME/PAYROLL TAX.
We all should remember Edmund Burke’s warning that applies to our efforts to TAKE BACK CONTROL,
“Nobody made a greater mistake than he who did nothing because he could do only a little.”
Please go to this link to invest in AFFT and your country. It’s an investment in your and your family’s future.