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OPINION | JOHN BRUMMETT: The income-tax conundrum

by John Brummett | January 12, 2023 at 2:50 a.m.


New Gov. Sarah Sanders set the Arkansas Primitive Assembly to hootin' and hollerin' in happiness in her inaugural address Tuesday.

It happened first when she declared that, under her leadership, the state would take the income tax down and eventually away. That is a very popular political notion, especially in states with low math scores.

It happened more loudly when she said we'd then take more of what money is left in the state treasury and give it to parents to send their kids to church schools and other private schools--including, presumably, to parents already possessed of the financial wherewithal to do so on their own.

That is a transfer of wealth, which Republicans are against if the transfer is from those with to those without. But if it's from those without to those with, and from the public schools of our national heritage to private and religious schools, then it's occasion for primitive delight.

A personal note: I like public charter schools--if limited to a few--offering new methods to underprivileged children and showing new methods to regular public schools, which, I believe, ought to heed charter-school successes. But that doesn't begin to mean that I'm for wholesale abandonment of public education as we have known it, or for subsidizing rich parents' privileges.

Sanders said children win when parents get money with which to blow off the local public school. Well, she actually said children win when parents have choices. I went ahead and clarified the choice.

There is reason to hope and expect that she and the Primitive Assembly won't do as much harm as they might. Arkansas is a rural state with wide expanses of public school monopoly. Any movement there likely would be among school districts a few miles apart.

I rather suspect Sarah and her rural conservative pals know that and don't much care because what they really want is to stick it to the public schools in Little Rock.

As for doing away with the income tax, let me explain that it'll be much more easily accomplished if a couple of things happen.

One is that we'll need two or three worse pandemics--so bad this time that the hospitals fill and we're rolling the ill into arenas and football stadiums, forcing the politicians to order our economy shut down more thoroughly than before, leading the federal government to print more trillions to send to state governments so that life itself can be propped up artificially while the scientists work on saving us with vaccines and medicines.

Asa Hutchinson was able to get income taxes reduced gradually while reaping surpluses largely because of all the federal money pouring in for covid relief--more than state government could spend.

The second thing we'll need is for liberal Democrats to take over all of federal government and start a new generous matching program so that states can make out like bandits by spending one existing buck and getting three or four newly printed ones sent from Washington.

The other reason Hutchinson was able to get income taxes reduced gradually while reaping surpluses was that liberals expanded Medicaid under Obamacare, giving the people of a poor conservative state like Arkansas the best of both worlds--an opportunity to rail against liberalism, indeed some say socialism, and then reap the gift of the federal money to get their state income taxes cut.

Failing those things, steep cuts in state income taxes by conservative state governments tend to work out catastrophically, such as in Sam Brownback's near-bankrupted Kansas and Bobby Jindal's Louisiana, where they undid the tax cuts and elected a moderate Democratic governor after it turned out LSU might have to close and it might even affect the football team.

Think about that. Deep income-tax cuts by a conservative Republican governor in Louisiana might have meant no Joe Burrow.

I've quit preachin' and started meddlin' now, haven't I?

One other element of the tax debate I should mention has to do with this business of Arkansas needing to get competitive with bordering states in terms of low or nonexistent state income taxes. What people ought to concern themselves with is that those states offset the absence of income-tax revenue either with precious natural resources or, more likely, local property taxes for the schools.

I should mention the thing called supply-side economics by which government treasuries grow with reduced income taxes because people spend more and rich people start more businesses and the economy grows. It's never much been borne out. But let's put it out there.

Let us bring all this back around: Absent two or three fortuitous plagues and a takeover in Washington of liberal Democrats trying to help people with new programs and new money funneled to states, any effort to do away with the state income tax in Arkansas probably would require steep increases in your real and personal property taxes, if, that is, we intend to pay well-off people, and even needy ones, for pulling their kids out of the public schools in Little Rock, if nowhere else, and putting them in private schools or other profit centers.


John Brummett, whose column appears regularly in the Arkansas Democrat-Gazette, is a member of the Arkansas Writers' Hall of Fame. Email him at jbrummett@arkansasonline.com. Read his @johnbrummett Twitter feed.



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