Jan 26 2013

 

 

Poverty_america

Being poor in America is getting to be tougher and tougher. Congressional Republicans have described the poor as the 'takers' as if they enjoyed living in poverty. The Republicans in Congress want to cut programs that will help American living in poverty move into the middle class. At the same time they want to cut taxes for the rich.

Now comes along a group of Republican Governors who actually want to tax those making less while cutting taxes for those who make more. Republican Governors in Louisiana, Kansas and Nebraska are all submitting proposals that would dramatically cut or do away with the income and corporate taxes and at the same time increase sales taxes.

Sales taxes would place an additional burden on the poor and the middle class. High sales taxes will discourage Americans from buying new merchandise just as the economy is recovering. The Republicans are not only having a "Let Them Eat Cake" moment but now they are expecting the poor to pay for the cake!

In an article by Richard Stevenson in the New York Times, he reports:

"Republican governors are moving aggressively to cut personal and corporate income taxes, including proposals that would increase reliance on state sales taxes, setting up ambitious experiments in tax reform that could shape what is possible on a national level.

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In Louisiana, Gov. Bobby Jindal is pushing to repeal the state’s personal and corporate income taxes and make up the lost revenue through higher sales taxes. Gov. Dave Heineman of Nebraska is calling for much the same thing in his state. Gov. Sam Brownback of Kansas wants to keep in place what was supposed to be a temporary increase in the state sales tax to help pay for his plan to lower and eventually end his state’s income tax.

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But Democrats say the approach would lead to cutbacks in education, health care and other vital services while shifting relatively more of the tax burden to those who can least afford it.

“These aren’t pro-growth policies — they’re shell games that reward the wealthiest Americans at the expense of everyone else,” said Danny Kanner, a spokesman for the Democratic Governors Association.

Nationwide, sales taxes account for about 46 percent of state revenues, and personal and corporate income taxes for about 42 percent, according to the National Conference of State Legislatures. States with relatively low income tax rates like Louisiana, which raises about $3 billion a year from its personal and corporate income tax system, can more easily shift toward a sales tax-only system than states with much higher rates, like New York or California.

Louisiana already has the nation’s third-highest sales tax, after Tennessee and Arizona. Combined state and local sales taxes average 8.84 percent, according to the Tax Foundation.