Gov. Sam Brownback brought his pitch for a flatter state income tax to the friendly confines of the Riley County Republican Party Saturday, telling more than 100 attendees at a fund-raising breakfast that simplifying the state’s tax code would spur growth — and therefore revenues — in the state.
Although the area’s economy has been relatively prosperous, he noted, the same does not hold true for most places in Kansas.
“You guys have done a great job on growing,” Brownback said, referencing such things as the NBAF, the Manhattan Regional Airport and the soon-to-open Flint Hills Discovery Center. The jobless rate in Riley County is lower than the statewide average, and home values have held relatively steady.
But that, he said, is the exception, not the rule, statewide.
“You are one of about eight counties in the state that are actually growing,” he said. “Consequently we’re losing taxpayers.”
Brownback believes the changes he proposes for the state’s income tax code would make the state friendlier to business and thereby invigorate growth. He contends that the state’s tax rate is higher than any other state in the region, prompting a general outmigration of jobs. He describes his solution as a flat tax with a small business accelerator. “The tax proposal we have takes the income tax off of small business because this is where most people are employed and this is your growth engine,” he said.
Brownback’s plan would not only flatten rates, it would also remove exemptions, credits and deductions from the code. Acknowledging that such a step would be controversial, Brownback says the tax code should not be used for social engineering because it is inefficient. “If you want to subsidize things, do it through social rehabilitation services, do it through … Medicaid,” he said. He described it as “a pro-growth system…close to revenue-neutral, not quite.” And, he added, “it will get us competitive in the region so we’re not losing people particularly to Missouri,” which he described as “our most competitive border.”
The governor indicated he viewed the biggest obstacle to his plan as people’s natural aversion to change. He said the most common reaction is, “I’d just kinda rather stay where I am.” But, he added, “the track that we are on is a slow, steady decline, and unless you change that track you’re going to continue on that path.”
He also stressed a desire to free up individuals to chart heir own course. “How do we free the American people and the genius of America and the genius of the individual to let them prosper and grow,” he asked. “The genius of this country is how you free the individual to be the most he could possibly be.”