Tagged: Tax Policy
Searcy City Council to Introduce A&P Tax 2.0
Remember that pesky A&P tax that the people of Searcy forcefully rejected in 2010? It’s back, albeit in a slightly different form.
While there have been some private rumblings for some time, Alderman Don Raney has now made it publicly known that he intends to propose yet another tax increase to the Searcy city council at the August meeting.
You can read the ordinance as well as a letter from Aldmeran Raney here.
In Raney’s letter, he identifies two concerns that were raised about the last A&P proposal: 1. The issue was not placed at a general election & 2. The funds were to be overseen by an unelected commission rather than elected public officials.
(Mr. Raney is partially correct. There were objections raised about the tax being placed at a special election, but I never heard anyone demand it be placed at the general election, but simply at a regular election–primary or general election. But I digress.)
I fear that Mr. Raney thinks these two compromises on the part of the city will ease the concerns of everyone who opposed the A&P tax the first time–and for some former opponents, that may be true. But the problems with an A&P tax are fundamental.
For instance, is it ethical for our city to slap tourists with an extra 3% when they come to our city? Should they bear the cost for our amenities? And is this sound tax policy? (by the way, that 3% would also apply to groups that rent rooms for meetings in town, perhaps including Kiwanis, Lions, church groups, etc.)
Shouldn’t an “A&P tax” go towards “advertising and promotion?”
Should we be raising taxes on food?
Doesn’t this tax disproportionality effect the poor?
Do parks improvements really take precedence over infrastructure and public safety?
What level of taxation can our city sustain? Can we really keep raising taxes every time someone wants a new project and expect real growth?
Our economy is still floundering–what impact would this tax have on consumers who are tightening their belts even more?
I think these are questions that deserve answers. I’m looking forward to having a conversation with you–Searcy voters, people of White County, and activists from around the state that have seen the disastrous effects of A&P taxes and big government in your cities.
I have little doubt the A&P proposal will have any difficulty making it through the city council, so the debate is imminent.
(To our dear Searcy leaders: Sorry, I know you thought this blog was defunct. And while it is true that I have been, and will continue to be, primarily occupied with my work at The Arkansas Project, I will be taking time to weigh in on this tax debate as much as possible. I may not be leading the charge this time, but I will make my voice heard and the people will be given the facts about this proposal.)
Former TEA Party Congressman, Rick Crawford
Well, I’ve bit my lip for about 24 hours on the news that Republican Congressman Rick Crawford (AR-1) is proposing a new ‘millionaire surtax.’ I was kind of hoping it was just a bad dream, and then when I realized it wasn’t, I wasn’t sure I could write this post without cursing. But we’ll give it a go.
The news broke yesterday that Crawford, who had previously been identified as a member of the TEA Party, is proposing the surtax as ‘a strategic matter.’ It appears this week that Crawford has more in common with the Occupy movement & Obama.
An aide to the congressman has reportedly said:
He’s watched the Gangs of Six and 100 and deficit commissions, as well as leadership’s budget and tax plan, and he feels there will never be a deal that will pass the Senate without a revenue component.
In other words: forget principles, commonsense, and reason. This bill might pass, so we should do it, despite the economic consequences, the violation of trust with his constituents, and the breaking of a campaign pledge to not raise taxes! A classic example of politicians wanting to ‘do something’ to achieve a feeling of accomplishment, but rather only exacerbating the problem.
Crawford had signed Americans for Tax Reform’s tax pledge in 2010, promising to oppose any and all tax increases. Grover Norquist, president of ATR, says Crawford’s bill does violate the pledge and the effort is a ‘strategic mistake.’
One of Crawford’s Democrat opponents, Clark Hall, also weighed in with this dandy of a quote:
Rick Crawford thinks taking all sides of an issue and holding one’s finger up to the political wind will help his election chances. In reality, it’s political cowardice, and the only compromise Rick Crawford has shown willingness for is a compromise of his principles.
Of course it’s hard to imagine Mr. Hall being ideologically opposed to such a tax increase himself, but the real travesty for Crawford is that this conservative is having a hard time disagreeing with Hall’s comments.
As for the economic realities of the bill, here’s what the American Enterprise Institute had to say:
1. The best way to raise tax revenue is by boosting economic growth. The second best way is to trim or eliminate tax breaks. The worst way is to raise marginal rates on people with the most ability to avoid them via economically inefficient tax shelters. Also note that this surtax would be in addition to the 3.8% surtax on investment income starting on Jan. 1, 2013.
2. Higher taxes in exchange for what, exactly? Structural entitlement reform or — more likely — cuts in future spending increases according to some fanciful budget baseline.
3. What if we tried increasing taxes on higher incomers enough to reduce the average federal deficit to 2 percent of GDP over the last five years of the decade? According to a 2010 Tax Policy Center study, if you used the Obama budget as a baseline, you would have to raise the top two rates to 90.9% and 85.7%. And even that forecast comes with a major caveat: “These static revenue estimates do not account for behavioral change.” Shorter, we assume massive tax increase don’t kill the economy.
Surely Congressman Crawford wouldn’t advocate 90% tax rates to tackle the deficit? Sounds silly, I know, but what if it would pass the Senate? Wouldn’t that be justification to vote for it, or even propose it?
Congressman Tim Griffin weighed in as well with some reason in the madness, voicing his opposition to the Crawford plan:
New taxes won’t convince those who want to grow government to support a balanced budget, and regardless, our economic and fiscal problems were created because the federal government spends too much, not because we are taxed too little. Any revenue a new tax might generate won’t make a dent in the problem our decades of overspending have created.
I know Congressman Crawford has been busy calling TEA Party-types in his district this morning. I for one would love to hear his explanation of how he can justify breaking a campaign pledge, particularly considering the dire consequences.
I am not ready to make a prediction about his re-election prospects, but I think it’s safe to say that the congressman has now left the ranks of the TEA Party.
Nic Horton
