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Conservative Kansas Legislature Turns Heads With Huge Tax Hike

Jun 25, 2015
Originally published on July 1, 2015 3:01 pm
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Kansas has one of the most conservative legislatures in the country, so this might come as a surprise. This month, lawmakers there passed the largest tax increase in state history, and now some of those responsible for the hike are trying to rebrand it as something else. Kansas Public Radio's Jim McLean explains.

JIM MCLEAN, BYLINE: This wasn't supposed to happen. In 2012, Republican Governor Sam Brownback and the conservatives who control the legislature set out to make Kansas an economical for the rest of red state America. They sliced income taxes with help from the man who devised President Ronald Reagan's trickle-down economic policies. But instead of jumpstarting the Kansas economy as promised, the Brownback tax cuts sent state revenues plummeting, forcing him and Republican legislative leaders to do the unthinkable - raise taxes. Brownback's critics say the tax is proof that his economic experiment is a failure, but the governor continues to insist it will work given enough time.

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SAM BROWNBACK: We're focused on growing the Kansas economy and growing people's personal income so that they can determine what they want to do with their resources. This is good for all Kansans. It's not just my opinion of that - that's the facts.

MCLEAN: Brownback says the tax cuts are producing private sector jobs. But critics say most measures of economic vitality show Kansas badly lagging, both the nation and the region, and they say the state has actually lost jobs since reaching a high water mark in October of last year. In the meantime, they argue that the income tax cuts are crippling state government.

DUANE GOOSSEN: The 2012 tax cuts were based on two false notions.

MCLEAN: Duane Goossen is a former Republican legislator and state budget director. The first false notion, he says, is that the income tax wouldn't cause a sustained drop in revenue.

GOOSSEN: And the second notion that was false was that spending could be controlled. Those two false notions proved out false at the very same time.

MCLEAN: Facing a projected budget deficit of $400 million, Democrats and moderate Republicans wanted to roll back the income tax cuts. In particular, they wanted to repeal the tax exemption given to 330,000 business owners. But Brownback threatened to veto any attempt to repeal his business tax breaks or slow down his so-called march to zero-out the income tax. He insisted instead on increasing sales and tobacco taxes, the economic equivalent of low-hanging fruit. Democrats like Senator Tom Holland argued that the governor's plan was an attack on low and middle-income taxpayers.

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TOM HOLLAND: You know, if you want to go down this path, go ahead majority party. Go to the doors this fall and next fall and make that sale. Something tells me it's going to be a tough one.

MCLEAN: It proved to be a tough sell even to lawmakers, but threats of university budget cuts and a downgrade in the state's credit rating helped GOP leaders finally corral the votes they needed. Wichita Republican John Whitmer was one of the last holdouts. Overcome with emotion as dawn approached on the session's last day, he gave in.

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JOHN WHITMER: Tonight, I set aside the needs of the one for what I thought was the best interest of the state. So I voted for something I am not proud of myself because I feel it's what the folks need.

MCLEAN: Almost as soon as lawmakers adjourned, Brownback started a campaign that critics say is designed to provide Republicans with political cover.

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BROWNBACK: Some would have you believe this bill represents a tax increase, and that is not accurate. When looked at in totality from 2012 to 2015, Kansans are paying less in taxes.

MCLEAN: But even the governor's conservative allies aren't on board with that explanation, and they worry that continued revenue shortfalls could eventually force lawmakers to repeal the tax cuts at the heart of Brownback's economic experiment. For NPR News, I'm Jim McLean in Topeka, Kan. Transcript provided by NPR, Copyright NPR.