I can’t figure out why anyone lives in Arizona anymore:
A Senate panel voted Thursday for a major revision in the state tax code that would mean lower bills for about 13 percent of Arizonans – and higher ones, on average, for everyone else.
The legislation, approved on a 4-2 party-line vote with Republicans in the majority, would replace the state’s graduated income tax structure with a single flat rate.
Preliminary estimates put that new figure at 2.13 percent. And that is lower than any of the current rates, which range from about 2.5 percent to 4.5 percent.
But to bring in the same amount of money as the current system, the plan would eliminate all deductions. That includes some big ones, like interest paid on home mortgages and charitable contributions.
And the exemptions from income that now exist for each person living in the home also disappear.
Rep. Steve Court, R-Mesa, who already has shepherded the proposal through the House, said the idea is fairness.
“This changes the way we look at how we tax income,” he said. “It also simplifies the process.”
Court said the idea of eliminating all those exemptions and deductions make sense “so that the government does not incentive how you spend your money and you don’t have a situation where a group of you all making $24,000 a year would all pay a different tax.”
But what Court called a “fair process” drew the ire of Sen. Paula Aboud, D-Tucson.
She pointed out the net effect is going to be a tax shift from those at the top of the income scale to those lower down. Figures crafted by the Joint Legislative Budget Committee conclude the break point is around the $100,000 range, with everyone below that paying something more than they do now.
He predicted that the average tax bill for those below $100,000 will be going up $200 a year. “It’s not going to be any excessive tax increase,” Court said.
Aboud bristled at that conclusion.
“Two hundred dollars to some people is a decider between food, medicine and a whole lot of things in these hard economic times,” she said.
I know that in these times of high unemployment, shrinking wages, budget deficits, and cutbacks in services across the board, the fiscally conservative thing to do is to cut taxes on the rich and shift the burden to those struggling the most. I wonder what Mitch Daniels, true fiscal conservative, would think?