Do You Want Your State Taxes Raised?
This past week an interesting update was given to the Department of Revenue’s 2011 Tax Incidence Study, which analyzed Governor Dayton’s tax hike proposal. You’ll recall Dayton wants to increase taxes by $2 billion on “the rich,” even though it doesn’t solve Minnesota’s projected $5.1 billion budget deficit.
Basically, the proposed tax hikes hit more people than originally feared – as in everyone. Dayton’s tax increase plan would increase taxes to Minnesotans on every income level, not just the people he considers rich. Therefore, even the poor could apparently qualify as the rich under the governor’s idea.
Whether you agree or disagree with the Governor’s idea to raise taxes, there are two points to be made. First, raising taxes alone will affect everyone, not just Minnesota’s most wealthy. Second, even if everyone pays more of their “fair share,” it won’t balance our budget.
So, as the debate continues as to whether we raise taxes or reduce government spending in order to eliminate our projected deficit, I would like your input. It’s always easy to want someone else’s taxes raised, but as this recent news highlighted, all of us, including you, will pay more if this plan became law.
We already have a progressive tax system. You pay a tax rate based on the income you earn. Do you feel you are already paying enough, or are you willing to give government a bit more of your paycheck?
With this latest update, the dynamics of this debate have changed significantly. With this tax increase proposal hitting all income levels, it would force you to dig deeper into your pocketbook to pay more for state government operations. With that understanding, should lawmakers be fighting to increase taxes or control government spending in order to eliminate our deficit?
I have been arguing that we have a spending problem and not a revenue problem, but as always, I would appreciate hearing from you.