A walk through Crazyland

by David Safier

I recommend you tiptoe through this stuff. You don't want too much of it to get on your shoes.

With that word of warning, let's take a walk through Arizona Legislative Crazyland.

We're being asked to vote for a 1 cent sales tax hike, to make sure we don't cut schools any further.

But the Rs aren't so keen on that idea. Fund public education? What kind of Marxist are you anyway?

Their idea is to use the sales tax hike to fund a corporate tax cut. A bill already passed the House. But Bob Burns (R-Peoria) is having qualms about some of its provisions.

[Burns] can't support reducing state revenues as much as the original House bill would have when the state is still digging its way out of a multibillion-dollar hole.

[snip]

Failure to respond to the deficit would drive business away, even as the state tries to lure new firms with lower taxes.

OK, that makes some sense. Not much, but some. At least he wants to reduce the tax cut. But you knew there had to be a catch, right?

What they're planning to eliminate from the bill is a 10 percent across the board income tax cut. Get ready, because here comes the reason:

A plan to cut individual income tax rates by 10 percent across the board would be dropped. House Speaker Kirk Adams, R-Mesa, who wrote the original proposal, said he wasn't interested as much in helping individuals as he was in helping the owners of small businesses.

Nope, definitely don't want to spread those cuts around to help individuals. The Rs want to target them straight at business owners.

These folks who claim they hate the idea of redistribution want to redistribute individual's money (sales tax hike) to business owners (tax cut).

Still in the bill:

• Cutting corporate income taxes 28%.
• Reducing capital gains taxes on small businesses — instead of a 10 percent income tax cut for everyone, because no one but businesses should benefit from the cuts.
• "[A]llow companies that sell most of their products outside the state to use a formula that would leave them owing no state income tax at all." (Someone will have to explain that one to me. It can't be as vile as it sounds. Can it?)
• Repeal state property tax on businesses. Of course, that means the rest of our property tax will have to rise to make up for the shortfall.

To recap: Everyone, including the poorest Arizonans, the middle class and the rich will have their tax rates go up equally with the sales tax hike. And that will fund deep cuts in income, capital gains and property taxes for corporations and other businesses.

OK, you can wipe off you shoes now. I'm through.