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Arizona State Supreme Court; Words Have Meaning
There has been some wailing, gnashing of teeth, and rending of red t-shirts from the Red Teachers Movement in Arizona due to the Arizona State Supreme Court removing an initiative from the November Ballot. The required number of signatures were gathered to place their initiative on the ballot, but the problem is the fuzzy math on what the income tax surcharge percentage will actually cost upper-income taxpayers.
An Arizona Supreme Court ruling Wednesday knocked the Invest in Education income-tax measure off the November ballot.
According to the ruling, the measure’s description “did not accurately represent the increased tax burden on the affected classes of taxpayers.”
The measure, recently titled Proposition 207, was expected to bring in $690 million in additional funding for Arizona public district and charter schools.
Supporters had framed Prop. 207 as a way to fully restore the more than $1 billion in cuts to education funding since the recession.
Prop. 207 would have raised income-tax rates by 3.46 percentage points to 8 percent on individuals who earn more than $250,000 or households that earn more than $500,000. It also would have raised individual rates by 4.46 percentage points to 9 percent for individuals who earn more than $500,000 and households that earn more than $1 million.
Here is where the math gets fuzzy;
Prop. 207 would have raised income-tax rates by 3.46 percentage points to 8 percent on individuals who earn more than $250,000 or households that earn more than $500,000. It also would have raised individual rates by 4.46 percentage points to 9 percent for individuals who earn more than $500,000 and households that earn more than $1 million.
Currently, both incomes are taxed at the highest state bracket of 4.54 percent. So, under Arizona’s graduated tax, an individual who makes $750,000 now pays about $33,000 in state income taxes. Under the #InvestInEd proposal, the individual would have paid about $53,000.
The complaint alleged the petitions were misleading because they referred to the proposed tax-rate increase as a “percent” increase and not the more accurate “percentage point” increase. According to the complaint, the tax rate would have seen a 76 and 98 percent increase and not a 3.46 and 4.46 percent increase.
Kudos to the Arizona Republic for telling the full story for the Court’s decision. Perhaps it’s time for some red teachers to take a refresher course in mathematics. I’m sure it’s much easier to sell a 3- to 4-percent tax increase rather than a 76- to 98-percent tax increase. They can pass on the refresher course in marketing.
Published in Politics
Perhaps not surprising that today’s teachers are innumerate or perhaps it is simply deliberate obfuscation
Right now AZ has the tax arbitrage edge over California and is attracting people and businesses. This proposition would destroy that advantage.
Having recently located to AZ from CT, a state that 25 years ago destroyed its tax advantaged status and now finds itself in a ruinous fiscal situation, I hope AZ does not repeat this mistake.
The irony would be delicious if it was merely incompetence. Alas, in this case the obfuscation seems likely to have been deliberate.
Arizona is welcoming of new residents, but unlike you some of these new residents that are leaving states with high taxes forget why they moved here when it comes to decisions on taxation, and intrusive government at the ballot box.
They are like the Bourbon kings of France, of whom it was said, “They learn nothing and they forget nothing.”
The Fairfield County-centric elite looked only to the tax advantage relative to NY and figured they could raise taxes to near NYC levels while still having a tax advantage and still being able to compete with Westchester County and Northern NJ for NYC overflow.
Many of the NYC investment banker types who lived in Fairfield County already paid NYC taxes, so implementing a CT income tax really did not directly affect them.
That may have been fine for the Fairfield County (mainly Stamford) bleed-over NYC financial industry and the Greenwich/Westport NYC suburbs. The rest of CT’s economy was largely light manufacturing, defense, and US headquarters of foreign companies (it was really nice for a VP doing a one year tour in the US to not pay NYC taxes while having an hour drive to take their spouse to NYC theaters, restaurants, stores, etc.).
It also did not help that they raised energy prices by closing nuclear power plants and started banning guns.
As a result, the light manufacturing industry and pretty much the entire small arms industry went south or offshore. Despite the sub base and casinos Eastern CT looks a lot like rural WV sans access to decent guns and buildings named after Robert Byrd.
Is this seen as a boon for GOP candidates Doug? Or was this outsized tax increase, however deceptive the framing, a great issue for Republicans to run against and a difficult tax for centrist Democrats to oppose given the power of teachers unions over their party?
I believe that it might effect the governor’s race, but not in a big way. Governor Ducey will need to remind voters that he arranged an incremental 20% pay increase for teachers that will take full effect in 2020. His Democrat opponent is a former teacher but selling tax increases in Arizona is pretty difficult. If Governor Ducey reminds voters that 3% is not 76%, and a 20% pay increase is a substantial pay increase that will probably blunt the rhetoric of the Democrat candidate.
Wait, where are the dividends on my “investment?” We need to take that word back.
Our local county council wants to raise our sales tax again, and they’re using the same tactics as last time to con the voters into voting for it. They refer to it as a “penny tax”.
What it really is is an increase in the sales tax from 8% to 9%. However, they say “it’s only a penny per dollar”, hiding the fact it’s added on to the existing tax.
Fooled me once, shame on you. Fooled me twice, shame on me. This time, we’ll find out how savvy our voting citizenry is . . .