We all want and deserve thriving communities with great schools, parks and well-maintained streets. But to have these building blocks of economic growth, everyone must chip in, that’s what taxes are for.
To grow our economy and improve quality of life, we need to invest in public structures. Arkansas is home to several of the nation’s largest companies. We can, and should, have the greatest schools, health, infrastructure and safety in the nation. When we spend on fundamentals like quality education, modern infrastructure and other public resources, we are investing in Arkansas’ prosperity.
Unfortunately, some Arkansas lawmakers have misplaced priorities, and are letting the wealthy push unfair tax policies through for their own benefit.
Most of us can’t explain exactly how the tax code works, but when we see schools struggling, college costs going up and library and emergency services getting cut, while a few at the top push for ever-growing tax cuts, we know our state’s priorities are wrong.
Our tax code needs serious reform after two legislative sessions which saw massive tax cut packages that heavily favor the rich. In 2015, the governor’s “middle income” tax cut provided those middle-income earners an average cut of just $39, and left out the poorest 20 percent of Arkansans. Legislators also restored the 50 percent break on capital gains income as well as a shameful exemption on all capital gains income over $10 million. Because of these two bills alone, the state will lose $28.9 million in state general revenue in 2016 and $102 million in 2017.
To make matters worse, Governor Hutchinson has already announced he would like to cut taxes further in 2017. You don’t need to look too hard to find examples of these disastrous policies in action. Kansas and Louisiana, two states who aggressively slashed taxes in recent years, have seen slow economic growth and extreme budget shortfalls. LEARN MORE HERE
These out of control tax breaks are syphoning off resources that would be better used in our communities. We should be spending on things that benefit every Arkansan, rather than tax breaks that mostly benefit a few.
In Arkansas, any extra cuts would be especially irresponsible because we are already sacrificing public services due to a tight budget. A number of important programs, such as juvenile justice programs and funding for local libraries, received cuts this year.
Arkansas’ outstanding pre-K program has been flat funded for 8 years, and needed a $16 million cost of living increase to continue to serve Arkansas littlest learners. Instead the program received just $3 million in one time money, while the capital gains cut will cost the state $11 million in revenue.
Which path will we take: the path toward thriving communities across our state, or the path toward slow deterioration and increasing inequality?
We must fight personal income tax cuts for high wage earners which pose a serious threat to state revenues needed for critical programs.
The sponsor of this CFC priority, Arkansas Advocates for Children and Families is releasing a 4 part series on this issue.