Tax Cut Irrationale #5

Steve Voeller, Director of the Arizona Free Enterprise Club, is so wrong on so many levels in his pitch for tax cuts it's scary. To use Charles Goyette's phrase, he needs to "avoid the Kool-Aid."

Voeller continues the lie by saying that the tax cuts alone made the State grow simply ignores reality. Arizona's economy moved from agriculture, mining and tourism to high-tech in the 80's and 90's, which increased the size of the tax base and expanded the real estate market because of the increase in employment. It doesn't snow here, so many people moved here for the climate figuring they'll get a job in the growing tech economy. So is it a shock that people in real estate, computer sales, defense satellite systems, marketing and sales are successful here? Nope.

Why were taxes higher in the first place? Because Arizona didn't have a diverse industrial or economic base back then. We do now. More business means more firms, more jobs and more people contributing to the State treasury. That's what grew revenues, not tax cuts.

According to The Tax Foundation, Arizona's rates are "competitive among all of the states," we rank 39th in income tax rates and we're at the national average with regards to tax burden. Voeller says people making between $50K and $70K should be happy with an additional $117 --per year-- and those with lower incomes would get less. Wow, time to start that investment account or buy a couple tanks of gas.

Most research that looks at why businesses move or why they're started in the first place do NOT includes taxes at the top of the list. It's the market, cost of labor, cost of land, and cost of benefits that lead the list. Does Voeller really expect us to believe that someone will not start a business because of personal income tax rates? Does he think we're stupid? Close. He thinks we're gullible.

Good corporate citizens understand paying taxes makes sure their streets are paved, their businesses are safe, their employee's children are educated and they have safe drinking water, among many other things. Can they be too high? Sure. But Arizona has lower taxes than two-thirds of the States and we have a surplus. LetÂ?s use it wisely on things we need to support the ongoing growth Mr. Voeller can't see is already there.