TAX POLICY REPORTS

Do tax breaks boost growth?
Kansas spends tens of millions on economic incentives annually, but without regular evaluation of the programs, it is difficult to know whether they meet their intended goals. Several proposals from lawmakers would help increase transparency around economic incentives and their effects. Increased transparency about the cost, impact and goals of economic incentives can lead to stronger, more evidence-based policymaking. (Read the report in HTML format.)

Revenue for the 21st Century: Taxing internet sales in Kansas
Kansas lawmakers should enact legislation to collect sales tax due on internet purchases to modernize Kansas’ tax code, level the playing field for small businesses, and capture a sustainable and renewable source of revenue that our state sorely needs. Legislators reversed course in 2017 on Gov. Sam Brownback’s tax experiment, but that was only a first step.

TOOLKIT: A Guide to Income Tax Reform
Policymakers, advocates, and Kansans need the facts on Senate Bill 30 – a comprehensive income tax reform bill boldly passed by a bipartisan majority of lawmakers during the 2017 Legislative Session. Alongside the Rise Up, Kansas coalition, the Kansas Center for Economic Growth (KCEG) has produced this easy-to-use tool to help better explain what SB 30 means for Kansas communities in every county.

Senate Bill 30: The Legislature Sets Kansas on the Road to Recovery
On June 6, 2017, Kansas lawmakers courageously enacted Senate Bill 30, a comprehensive income tax bill. Senate Bill 30 passed five years and two weeks after the Governor’s signature tax policy was signed into law – an irresponsible tax plan that triggered devastating budget cuts and weakened public services. Senate Bill 30 has put an end to the most disastrous parts of the Brownback tax experiment and is a crucial first step on Kansas’ road to financial recovery.

A Flat Tax Would Only Worsen Kansas’ Budget Crisis
Governor Sam Brownback’s 2012 plan to phase out the state income tax created an unprecedented fiscal crisis for Kansas. Some options presented for addressing this crisis would “flatten” Kansas’ income tax and require all Kansans to pay the same income tax rate, regardless of how much they earn. A flat tax would shift even more of the state’s tax burden onto those who can least afford it while stunting economic growth and failing to generate the revenue necessary to end Kansas’ repeated budget shortfalls.

New Legislative Experiment Would Lock in Crisis Budgeting Brought on by Tax Cuts
Recent resolutions (SCR 1602 & HCR 5007) introduced in the Kansas Legislature would prevent the state from meeting even its most basic needs and hurt the foundations of the Kansas economy. The bill proposes etching into the state constitution an extreme and inflexible, formula-based cap on state revenue and investments called “TABOR,” or the so-called Taxpayers Bill of Rights.

A Guide to Comprehensive Tax Reform in Kansas
Job #1: Stop the bleeding. The first year alone of the Brownback tax plan inflicted more damage to state finances than the entire Great Recession. Kansas continues to hemorrhage revenue, resulting in nine rounds of budget cuts, record-high debt, and three credit rating downgrades. Our struggling communities need relief, but Kansas can’t start healing while still in triage mode. In 2017, we must immediately fix our structural revenue imbalance to prevent further cuts, accepting that significant re-investment is probably at least another year away.

Tax Cuts Taking a Toll on Kansas Communities
Recent tax cuts have prevented Kansas from restoring critical investments in schools and other services that were cut during the last recession. This continues to strain the ability of communities to provide the level of services that create a strong workforce, sense of community and high quality of life – all things necessary for Kansas to grow and thrive. Counties have increased their property taxes to try to cover funding gaps but are struggling to make ends meet and provide the basic amenities we need to attract people and grow businesses right here in Kansas.

EITC: A Tax Credit That Works For Working Families
The Kansas state Earned Income Tax Credit (EITC) helps more than 200,000 working Kansans — primarily those with children — make ends meet. It reduces the taxes they pay, leaving them with a little extra income to cover the basics. And it builds on the success of the federal EITC at keeping families working, reducing poverty and improving children’s prospects in school and later on in life. Despite its overwhelmingly positive track record, over the years there have been efforts to scale back or eliminate the state’s EITC.

Trailing the Competition: Governor’s Measures of Economic Growth Show Kansas Behind Region
Kansas’ economy is performing poorly compared to neighboring states on most measures, despite tax cuts that supporters promised would bring strong economic growth. The state is trailing in the overall output of goods and services, employment growth, wage growth and population. It is doing better on unemployment — where it has traditionally had an edge — and, recently, building permits.

Who Pays? Kansas State & Local Taxes in 2015
A new study released today by the Institute on Taxation and Economic Policy (ITEP) and the Kansas Center for Economic Growth finds that the lowest income Kansans pay 11.1 percent—or greater than two times—more in taxes as a percent of their income compared to the state’s wealthiest residents.

New Release: Low-Income Taxpayers in Kansas Pay More Than Twice the Tax Rate Paid by the Richest Kansans

Proof positive? Revenue gains don’t mean tax policy’s working
The recent uptick in state income tax revenue touted as proof that the 2012 tax cuts are stimulating Kansas’ economy is anything but.Revenue Secretary Nick Jordan noted earlier this month that Kansas personal income tax collections came in at 5.7 percent greater than in April of last year. This, he said, confirmed the administration’s contention that “a fiscal environment where Kansans get to keep and invest more of their paycheck would bring economic growth to the state.

It’s Not Always Sunnier in Florida
Proponents of eliminating Kansas’ income tax say that without it Kansas can be more like Texas and Florida economically. But they should be careful what they wish for: Texas and Florida both rank worse than Kansas on a number of key gauges of prosperity and well-being. Another inconvenient truth: Texans and Floridians pay higher sales and property taxes than Kansans, a predictable result of having no income tax.

“A Lost Decade” — Revisiting Kansas’ past, so we can redirect its future
Claims that Kansas’ failed tax-cut experiment was justified as a response to a “lost decade” for the state’s economy aren’t borne out by what actually happened at that time. If anything, there is strong evidence that Kansas’ economic situation is worsening since the tax cuts began to weaken the state’s ability to make public investments in schools and other drivers of job growth and widespread prosperity.