Gov. Sam Brownback didn’t get everything he wanted in tax-cut legislation from a state Senate he helped elect, but he could have done a lot worse.
In giving first-round approval Wednesday to the second phase of the governor’s campaign to eliminate income taxes, senators approved a reduction in the state’s top income tax rate to 3.5 percent for 2017. Last year the Kansas Legislature, as part of a historic package of tax cuts, reduced the top income tax rate to 4.9 percent.
Although senators didn’t eliminate two tax deductions the governor had sought — for mortgage interest and property taxes — they did agree to phase out those deductions as they phase out the tax itself.
Regrettably, senators also agreed to the governor’s proposal to keep the state sales tax at 6.3 percent. The Legislature three years ago approved a 1-cent increase (to the present 6.3 percent) in the state sales tax. The purpose was to offset losses and prevent further program cuts associated with the Great Recession. The rate is scheduled to drop to 5.7 percent on July 1.
Gov. Brownback wants to keep it at 6.3 percent to help generate revenue to enable the state to pay its bills, even as lawmakers trim the income tax, which has long been a key source of funding for the state.
We don’t object to income tax cuts. But subsidizing tax breaks whose benefits will be enjoyed mostly by the wealthy and doing so by maintaining an unnecessarily high sales tax that disproportionately hurts lower-income residents is simply wrong. Fortunately, support for lowering the state sales tax as originally planned is stronger in the House.
Paying the state’s bills while aggressively cutting taxes has proved problematic for the governor and his allies. Lawmakers this session continue their quest for cuts in state programs and activities to offset a projected revenue shortfall attributable to last session’s income tax cuts.
Not coincidentally, Kansas Treasurer Ron Estes on Wednesday issued a caution for legislators committed to additional tax cuts. “Maintaining a healthy cash balance within the state general fund is a key element to the continued operations of our state government and providing Kansans with state services,” he said.
That’s worth remembering, especially for legislators whose zeal to cut income taxes is compromising the state’s ability to pay its bills and provide important services.