Tuesday, July 07, 2009

CAT Tax Update

I absolutely have to mention this piece from Jack Boyle of the Ohio chapter of the Americans for Prosperity that appears in the Plain Dealer because it goes back to a problem that I have with Jon Husted.

As he campaigns for Secretary of State, Husted is running around the state talking the talk but it has been my assertion that Husted has failed to walk the walk.

One of Kyle's anonymous contributors that always have a bone to pick with me for some reason wrote a diatribe aimed at my criticism of Husted on this point. Here is an excerpt from that post:
There is a definite split among Ohioans regarding the CAT tax but here are some things to think about...

It was passed as part of the state budget on July 1st and originally proposed by Ohio Gov. Bob Taft, the new tax code eliminates the tangible personal property tax over four years and immediately got rid of that tax on purchases of new manufacturing equipment in 2005.

The bill also eliminated the corporate franchise tax, lowered personal income tax rates and replaced those taxes with a lower tax rate on commercial activity.

The state estimates that the tax package will increase the state's gross state product by $5.6 billion by 2010 and increase personal income by $3.6 billion. The state also estimates it will create 78,500 new jobs and bring $6.3 billion in new capital investment into Ohio's economy during the same time period.

Simply put, it is supposed to remove a roadblock for new businesses coming into Ohio, making the state much friendlier to the industry.
The key word in that last sentence is "supposed". The reality is that it FAILED. And Husted has NEVER accepted responsibility for that failure.

Mr. Boyle addresses this in his piece:
The net effect of the tax changes made four years ago has not been a tax cut, but rather an increase in the total tax "take" of government in Ohio out of the Ohio economy.

The facts are that in 2008, according to the Tax Foundation, Ohio had the 7th highest combined state and local tax burden in the United States, up from a ranking of 11th in 2005.
Emphasis added. Only Democrats and RINOs call something that actually takes more out of the economy a tax cut. The only question remains: Which one is Jon Husted?

We can do better...

HT: Kevin Holtsberry for the Boyle article. BTW: Kevin asks, "What Tax Cut?" which is funny when you consider that CAT was part of Taft's budget that Husted supporters are so gung-ho about defending even though the only way it looks good is in comparison to Dick Celeste or Ted Strickland.