NC Spin recently tweeted a video called “What are your suggestions for further tax reform?” The question was posed to John Locke Foundation scholar Becki Gray, but I’ve decided to be shamelessly presumptuous and provide my own answer.
Focused on other issues, state-level Democrats for too long conceded tax reform to the Republicans. It was a huge mistake. Tax reform is to domestic policy what Physics is to science: The core around which everything else is built.
So when Republicans set about redrawing our tax system, all Democrats really had was a set of left-liberal platitudes on fairness and adequacy. We by and large didn’t offer detailed alternatives. And judging from Roy Cooper’s “Issues” site, we still aren’t. What follows doesn’t come close to constituting an actual tax plan, but I do hope these ideas may prove worthy of discussion.
First and foremost, we need to restore the progressive rate structure. Progressivity has distributional and economic benefits. By giving families an automatic tax cut when their incomes fall, a progressive tax code helps stabilize the economy without discretionary fiscal stimulus. Even as we scrap the flat tax, we shouldn’t try to go back to pre-existing rates, or chase the progressive dream of a New York/New Jersey-style “millionaire’s tax.” We live in a purple state that competes with red ones. Our tax rates should reflect those realities.
Sales tax expansion has been a red-hot issue, and we shouldn’t duck it. About a quarter of our revenue comes from sales taxes, and given the economy’s steady shift toward consumption there is an argument that they should account for more. But expansion of the sales tax cannot be used as a weapon to punish the “lucky duckies” whom Bob Rucho so resents. New sales taxes should be levied on affluent-preferred services like financial advice and–I’m not joking–water skiing lessons, and the rate must be lowered by a percentage point or two. That way, we’ll get a more balanced revenue stream and give much-needed relief to the poor.
Now we get to business taxes. The GOP’s radical corporate tax-changes must be frozen–now. Because the business lobby has already gotten its desired rate cuts, we can and should raise more corporate revenue by closing loopholes. Requiring “combined reporting” should be at the top of the list. We should also lift the ban on local privilege taxes, thus allowing cities to raise revenue without punishing the poor and/or seniors.
I’ll end with a somewhat outside-the-box proposal. We should significantly raise our alcohol taxes. An NIH study found that, when Illinois raised its liquor tax by 50% and its beer tax by 25%, alcohol-related fatalities fell by 26%. Illinois’ tax increase spared an even larger number of young lives–a 37% fatality-rate reduction. Urban progressives may disdain the aesthetics of this proposal, but higher booze taxes would raise revenue and save lives.
Alexander Jones is an original contributor to PoliticsNC.
Just what might happen when you ignore conservative economic doom sayers like Art Pope and the John locke foundation??? this is what might happen.
California’s robust economy helped it pass France. … California Passes France As World’s 6th-Largest Economy June 17, 2016
they taxed the wealthy
If there’s anyplace in the country where rising tax rates should choke off an economic recovery, it’s California. On top of the federal tax hikes that kicked “in last month, the state has just raised income taxes on its wealthiest residents to the highest levels in the nation, a move that conservatives warn will drive millionaires and their companies to other states, taking jobs and growth with them.”
“The increases come as California’s economy continues a remarkable turnaround. A year ago, the state was a mess, with double-digit unemployment, a bottoming-out housing market and scary budget deficits. Now, hiring is up faster than the national average, and the housing market is regaining strength. Even the state budget is back in the black.”
Perhaps “PHD” stands for Piled Higher and Deeper at the John Locke Spin Factory …
I suggest that we all begin looking at successes around the country for ideas for economic growth in North Carolina rather that blindly accepting to word of a KochCo spin factory ..
The clowns are dangerous. Essentially the aim is to turn the state into a transient tax order like Florida. I had reasons to move to Florida and did not know how abnormal it was. My old used truck cost 425 dollars to register. Bureaucracy grows no matter what so taxes by another name are called Impact fees. Overall throughout the nation the assault is on the working class.
It will be interesting to see who gets the money borrowed to pay for things that ought be considered regular expenses, like the National Guard, or those roads & those buildings and labs.
One day the GOP, (C.S.A.) says they don’t have any money in the General Fund, then there is a surplus.
& like it is known, it isn’t how much money you have, but what you spend it on.
Trustworthy accounting, and a trustworthy worthy set of aims need to be set first, then where it is the money ought come from.
Government is about Defense & Education. Education as a sports franchise where coaches make millions and teachers get cut? What is up with that?
Now that Universities do all the R&D what relief for the students paying to do the work the head of department makes their rep from see from licensing fees?
& then at the bottom it is the youngest.
What will the Bond money be used for? Long long it has been known that there needs to be better connections for Morehead City to I 40 & I 95. Why doesn’t it happen? They can no longer blame the Feds.
We were supposed to see HB 819 revisited, but got HB 2. It shows how they think. When getting together and deciding what to do, it is make a law that protects brokers from having to tell beach front buyers the land will be underwater soon after the ice in Antartica falls in the ocean. That is supposed to happen by 2020 depending on storms.
Oh and the people on TV are up with Trans people, lets make a petty law that hurts them and makes 10 year olds have people to point at with epithets.
Since the water will rise, keep the population low, and plus keep the working classes poor. 25 percent, well thats lots of poor people to pay taxes. Make up fees the well off don’t see.