AD: Getting Serious about Tax Reform - Goldwater Institute: - Apr 17, 07

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Getting Serious about Tax Reform
By Goldwater Institute: Noah Clarke (04/17/07)

Hold spending to current levels for painless way to eliminate the corporate income tax.

Governor Napolitano's office has warned there might not be enough revenue to cut taxes this year. That is, as Barry Goldwater might have put it, "Poppycock!" There is plenty of revenue. The problem is that everyone at the capitol wants to spend it all.

Total revenue for fiscal year 2007 was $9.5 billion. Sales and individual taxes made up 90 percent of that amount. The corporate income tax represented nine percent, or just over $900 million.

The corporate income tax could have been eliminated if the state had simply limited spending in 2007 to what it spent the year before. In fiscal year 2006, Arizona's General Fund budget was $8.5 billion or $1 billion less than total revenue in 2007. That difference is more than enough to eliminate this anti- competitive tax.

Why the corporate income tax? Twenty-one states have lower corporate income tax rates than Arizona's 6.97 percent. Regional competitors Nevada, Wyoming and Texas have no corporate income tax. Colorado, Utah, Florida, and Georgia are all at 6 percent or below. When trying to maintain regional competitiveness and increase national competitiveness, these rates matter.

Simply controlling spending can free up ample money for tax cuts, and keep our economy growing.

Noah Clarke
http://www.goldwaterinstitute.org/AboutUs/ArticleView.aspx?id=1528

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The Goldwater Institute was founded in 1988 by a small group of entrepreneurial Arizonans with the blessing of Sen. Barry Goldwater. Like our namesake, the Goldwater Institute board and staff share a belief in the innate dignity of individual human beings, that America is a nation that grew great through the initiative and ambition of regular men and women, and, that while the legitimate functions of government are conducive to freedom, unrestrained government has proved to be a chief instrument in history for thwarting individual liberty. Through research and education, the Goldwater Institute works to broaden the parameters of policy discussions to allow consideration of policies consistent with the founding principles of free societies.
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