LETTER: Eliminating the income tax is not “easy peasy
To the Editor:
After hearing a radio news story about the very small decline in gas prices, my seven-year-old son asked, “Dad, why can’t everything just be free?” For a seven-year-old, that is a valid question.
After a quick conversation about how just about every society has a system of trade, barter or currency to aid in the exchange of goods, he was on to other things. As parents of two young boys, we often get questions or comments like the “why can’t everything be free” question. You know, the questions that make sense to ask as a child, the answer often too complicated for the seven-year-old mind to comprehend.
The very next day I found myself with the very same feeling, only it wasn’t my five- or seven-year-old with the comment, it came from the pages of Twin City TIMES. In the April 25 edition of TCT, Lance Dutson, CEO of The Maine Heritage Policy Center, shared the virtues and benefits of eliminating the income tax in Maine.
His thoughts: if we reduce the size of Maine’s government to the same level as we had in 1994, we could save $1.7 billion—this is about the same the number the state takes in via income taxes. “Easy peasy,” as my five-year-old would say.
Dutson says eliminating the income tax would put Maine “into a group of states leading the nation in economic growth.”
Lets look at the facts that even my kids can understand. Data from The Institute of Taxation and Economic Policy shows us that from 2001-10, four of the nine states without income tax have seen slower per capital growth than Maine: Nevada, Tennessee, Florida and Texas.
Of the nine states, six have seen wide an increase in the income gap between those who have and those who have not: Nevada, Tennessee, Florida, Texas, Alaska, South Dakota. Income for the higher 10% of wage earners in these states has increased, while the poor are getting poorer.
Few residents of Lewiston or Auburn would fall into the top 10% of the state’s wage earners. However, a disproportionate amount of Mainers and residents of Androscoggin County would be hurt.
Nevada, Florida and Texas rank in the top 10 in home foreclosures. Of the nine states that Dutson and MHPC want Maine to be like, seven have cut education spending and are among the bottom tier in school performance. Nevada, Florida, and Tennessee have higher unemployment rates than Maine (Texas and Alaska have virtually the same unemployment rate as Maine).
MHPC likes to tell us that Maine is losing residents to states where there is no income tax. According to the U.S. Census, 18 of the top 20 states in terms of population growth (between 2001-10) are located in the South or Western U.S.
According to census data, the reasons residents state for moving were: lower population density, accessible suburbs, Hispanic immigration and warmer weather. Six of the nine states without an income tax happen to also be in the South and the West. Perhaps MPHC will now suggest a lack of income tax will yield warmer weather?
We need to address tax reform in this state. We need a system that is fair for everyone and moves our state towards prosperity for all citizens. The process has to begin with an honest assessment and evaluation of where we have been, where we are and the paths before us. Options have to be based on reality, not rhetoric, skewed facts and figures or campaign promises.
MHPC isn’t concerned with the welfare (excuse the pun) of the entire state of Maine. Their message isn’t about a united Maine, or one Maine, it is about the size of the wallets of some and supporting a very narrow agenda.
Will Fessenden
Sabattus