Thursday, November 20, 2014

HAWVER: Tax cuts? Not just talk anymore

By MARTIN HAWVER, At the Rail | 10/14/2013

Life is full of little confirmations, so we know something is actually going to happen.

You’re out with someone for the first time and with just a glance, you know it’s not OK to put your arm around your date. Or you’re married and you can look at your spouse in the car showroom and in an instant you know whether it is OK to go ahead and get the leather seats on the car.

Life is full of little confirmations, so we know something is actually going to happen.

You’re out with someone for the first time and with just a glance, you know it’s not OK to put your arm around your date. Or you’re married and you can look at your spouse in the car showroom and in an instant you know whether it is OK to go ahead and get the leather seats on the car.

Well, the same thing happens with state revenues — which probably gives you an idea of the type of life us Statehouse insiders live.

The subtle confirmation we got recently was from the year-to-date line on the official Department of Revenue release about tax-only revenues to the state.

What?

Yes, confirmation that the state is actually cutting individual income taxes — whether we feel it in our wallets yet or not — came earlier this month when three months into this fiscal year, the state had collected $135.3 million less in income tax withholding than during the same period last year.

That means that Kansans actually are paying less income tax ... just like Gov. Sam Brownback and a majority of the Legislature wanted.

But, for all the talk about cutting taxes, there’s nothing like that little confirmation — less dollars in the state bank account — to actually prove it to us folks who hear about it, but want proof.

Now, this wasn’t a surprise; government-watchers had for months estimated reductions in revenue, forecasted by economic experts, that it would happen. But there’s nothing like the hard dollar figures for that confirmation.

Sure, the state cut its budget — which means less money being spent on things that either now, or at some time in the past, were thought to be good things — and we’re waiting to see just what budget cuts the governor or Legislature or Kansans won’t put up with.

This talk about cutting spending? Well, the 9-percent drop in state receipts so far this fiscal year means that it’s not just talk anymore — there just isn’t going to be money to spend.

We’re still waiting on the second part of that tax cut business, when we’re told that Kansans will spend that money they aren’t paying in taxes on things that will spur the economy, bringing industry and business to Kansas.

That new business and prosperity? It’s supposed to take time to develop, and at some point that new business and spending will make up for the loss in income tax receipts.

Just when that confirmation will happen, though, remains a question, and if it happens, in what fiscal year will it occur?

So far, from the revenue side, maybe it’s too early for those leather seats ... or putting your arm around your date.

Martin Hawver is publisher of Hawver’s Capitol Report. Visit his website at www.hawvernews.com

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