To the editor:
Kansas is in its fifth straight decade of economic stagnation, falling farther behind the national average on job growth and economic activity. For perspective, there would be 323,000 more jobs here if Kansas had just kept pace with the national average since 1979, and as a result, would have less population loss from people moving to other states.
The state’s high tax burden is a significant part of the problem. Over the last 25 years, the 10 states with the lowest tax burden (Tax Foundation), increased private-sector jobs by 42% versus just 27% for the 10 states with the highest tax burden. Census data also shows how people vote with their feet; the 10 lowest-burden states gained 4 million people from other states while the 10 highest-burden states lost 10 million residents, and Kansas had a net loss of 193,000 people.
The Legislature would have saved Kansans $1.4 billion over the next three years if three Republican senators hadn’t prevented an override of Governor Kelly’s veto in a fit of political pettiness. The Legislature needs to try again next year to move Kansas to a flat tax of 5.15% instead of a three-tier tax system with progressively higher rates.
There are two main considerations of an income tax cut proposal: (1) how does it impact each person’s tax bill, and (2) what impact will the change have on the overall economy? A recent public forum letter in the Great Bend Tribune by John Sturn proposed retaining the three tax brackets with lower rates rather than going to a flat tax. He believes his approach would produce the same total tax savings and shift some of the benefit from people paying the top marginal rate of 5.7% to those paying lower tax rates. But even if the total savings were the same, the impact on the state economy would be much less.
According to the Tax Foundation, “flat taxes avoid impacting individuals’ and businesses’ marginal decisions, or what they will do with their next dollar of income. Whereas graduated-rate income taxes reduce the payoff to work and investment on the margin by imposing higher tax rates on higher levels of marginal income, flat taxes treat all taxable income neutrally and are less likely to discourage additional work, investment, and other activities that contribute to economic growth.”
Sturn’s proposal also further shifts the tax burden to people whose incomes make it easier for them to move to another state. Kansas Department of Revenue data shows that individuals with adjusted gross income above $100,000 had 61% of the income in 2021 and paid 70% of the tax; Sturn’s plan would have them paying 73% of the tax and keep people heading for the exits.
So if your goal is to keep higher rates on incomes above $30,000 single and $60,000 married, stay with the current system. But if you want to reduce tax burdens AND improve the Kansas economy, go with the flat tax.
Dave Trabert
Overland Park
