Tax Reform

Americans are a hard-working bunch and should keep what they earn. Our ideas for tax reform reduce the burden of taxes while ensuring governments have the resources to focus on core responsibilities.

<p>Americans are a hard-working bunch and should keep what they earn. Our ideas for tax reform reduce the burden of taxes while ensuring governments have the resources to focus on core responsibilities. </p>

The dreaded T-word has now entered the conversation at the capitol with lawmakers suggesting putting a "temporary" tax increase on the ballot. Any such tax increase would be in addition to the mid-year restoration of the state's property tax. That increase alone, once estimated at $250 million, would be one of the biggest tax increases in state history.

The Arizona Taxpayer Protection Pledge is a commitment to the voters of Arizona that the signer will "oppose and vote against" any tax increase.

Sending a tax hike to the ballot is supporting the tax hike. Voting against sending a tax hike to the ballot is opposing the tax hike.

Arizona Governor Janet Napolitano delivered her 2008 State of the State Address on Monday and touched on a variety of topics including education, the economy, and public safety. But in a state where revenues have decreased from a high of 20 percent growth in 2006 to about 1.5 percent growth this year, there was no serious proposal to re-energize Arizona's economy.

Arizona's recent budget history looks a lot like a rollercoaster. During years with strong economic growth, policymakers allow spending to shoot up to unsustainably high levels. Then, during economic slowdowns, when tax revenues fall off, state spending goes crashing downward.

Arizona's budget really got out of control in 2006 and 2007, when the size of state government as a portion of the state economy exceeded 6.5 percent levels of spending not seen since the early 1990s.

Republican Governor Jan Brewer's plan to raise sales taxes in Arizona is a bad idea which promises to make a bad economic situation a whole lot worse. Tax increases are a death sentence for economic growth. In difficult times, the last thing government should do is take more money out of the pockets of hard-working, productive citizens. 

Government should look in the mirror

With gas prices over $3 a gallon nationwide, some policymakers, Attorney General Terry Goddard among them, suggest the solution is to implement price-gouging laws. But the government might want to take a look at the man in the mirror first.

Government has done its fair share to push gas prices higher. Local, state and federal governments tack on 37.4 cents a gallon in taxes in Arizona alone.

It takes a mighty big wheelbarrow of money to buy bread in Zimbabwe today. To make things more convenient, Zimbabwe's government has decided to issue a new currency denomination for everyday use - the Z$100 trillion note (yes, that's right, trillion). Now, Zimbabweans need the wheelbarrow for the calculator needed to handle all those extra zeroes.

When engineers need to know the precise strength of a structure, they test it by adding tiny amounts of weight to an actual example or a model. Eventually, the structure fails. That last gram of weight--the one that makes the difference between an intact structure and a pile of rubble--is pretty significant, at least to the structure.

Despite a drop in residential real estate values, Arizona was among the top ten states in new, owner-occupied housing starts in 2007.

The construction industry has recently played a disproportionate role in Arizona's economy. As shown below, the construction industry's share of Arizona's economy was 50 percent bigger than construction's share of the U.S. economy in 2006.

If incoming lawmakers are going to hear from professors and pundits that the state's budget woes were caused by tax cuts and can be solved by tax hikes, then they ought to hear what actual taxpayers have to say about it as well.

The Arizona Free Enterprise Club, a pro-growth advocacy group, yesterday launched a "No New Taxes" petition in response to a growing discussion about a possible tax increase to balance the budget.