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Arizona Voters Pass Billion-Dollar Tax Hike; Lawyers Say ‘Not so Fast’
Arizona has been a welcoming environment for voter-led initiatives. If you produced enough signatures, you could get damn near anything on the ballot. The statehouse tightened up the requirements after 2006, which featured 19 propositions — some of which contradicted each other.
This year, there were only two: legalizing weed and hiking taxes on the wealthy for education. (This, after the state increased teacher pay by a whopping 20 percent.) Both measures passed but in Arizona, that just means the lawsuits begin.
First out of the gate is the Goldwater Institute, a limited-government nonprofit with a strong track record of holding tax-and-spenders’ feet to the fire. They’re taking on the education tax hikes … because they are utterly unconstitutional.
Proposition 208 would add an additional 3.5% income tax on income above $250,000 (single filing) or $500,000 (joint filing). That raises the state’s top rate to 8%. This new revenue would be “distributed,” not to the classroom, but wherever the teachers’ unions want the money to go. They’re still bitter that the Republican Gov. Doug Ducey refused to raise taxes and increased pay only for teachers instead of the bloated administrative class.
Victor Riches, President and CEO of the Goldwater Institute, notes that the measure harms middle-wage earners and small-business owners in the midst of the government-caused COVID recession.
“Prop. 208 violates the state Constitution, and it deprives the people’s elected representatives of their constitutional authority.” Riches said. “The Goldwater Institute is taking a stand to challenge the legality of Prop. 208 and to protect Arizona taxpayers against this illegal and ill-conceived measure.”
The initiative was placed on the ballot by out-of-state unions and special interest groups. Economists predict it will drive businesses out of the state, slow business growth, and create 63,000 fewer new jobs over the next decade — a loss of $1.1 billion in state and local taxes.
Not only is this horrible policy; it’s unconstitutional.
“Arizona’s Constitution gives voters the power to pass initiatives, but it also imposes important limits on the initiative power,” said Timothy Sandefur, Goldwater Institute Vice President for Litigation. “In fact, the state Constitution expressly provides that ‘any law which may not be enacted by the Legislature under this Constitution shall not be enacted by the people.’ And the Constitution limits both how taxes may be raised and how government may spend money. Proposition 208, however, ignores or tries to evade these limits.”
Taxes can only be raised with a two-thirds vote of the state legislature. A narrow majority can’t impose it with their meager 51.7%–48.3% victory on election day.
The Goldwater Institute has the facts on their side. Hopefully, the courts will destroy the education cartel’s cynical effort to line their pockets on the backs of hard-working Arizonans.
Published in Economics, Education, Law, Politics
Inshah’allah.
Good to see this challenge. Prop 208 establishes a perpetual slush fund for unions, administrators and school districts, unmoored to any measures of actual improvement in educational outcomes.
This kind of thing drives me absolutely bonkers. We don’t live in your state and won’t have to deal with the consequences of this, but we’re gong to interfere in your state’s affairs anyway.
Arizona is in transition. Good luck with your new Senator, Mark Kelly. He will be a Schumer man. John McCain married into Arizona, as did Mark Kelly. New residents are bringing their old voting habits with them. Everyone was excited about the new Intel plant coming to Maricopa County, it may turn out to be a curse rather than a blessing.
The state’s proximity to California makes it a ripe target for invasion by people who don’t like the cost-of-living there, but don’t get that their voting habits caused that — Arizona would have likely gone the Californiacation way of Oregon and Washington State 25-30 years ago if it had an ocean next to it.
The other scary part for Arizona is the people who voted for the tax hike most likely don’t have a clue who Barry Goldwater was, in terms of Arizona politics. But they know about Bernie if not Barry, and likely also know any Republican to the right of John McCain is evil (and if they were of voting age in 2008 wherever they lived, likely thought McCain was evil for running against Obama).
Oh Arizona, trying to be California. It’s adorable. Take a better look at the end of the movie, kids.
Not just California. I moved to AZ from Connecticut, which until 1991 did not have an income tax and had a healthy economy. CT proceeded to become a financial basket case even as it reaped billions of dollars in extra revenue from the ever increasing income tax. Although the extra taxes weren’t committed to a single purpose as with the AZ education tax, voters were told that one of the primary reasons the income tax was needed to properly fund state retirement plans which were only funded at 26% of what was needed. A quarter century later state retirement plans are funded at only 27%!
There are people in Austin and in the core areas of some of the other big metros in Texas who want to be like California. They for the most have no idea why they want to be like California, other than the fact they want to be part of a coalition of those with more power to tell everyone else how to live their lives, though some actually believe Texas — outside of the enlightened areas they live in — is a hellhole compared to California (and if you point to California’s progressive failures, you get the usual answer that California simply didn’t do progressive governance right, the way they would).
My guess is for the native Arizonans who voted for the tax hike, that’s the same mindset. California may be a place where the middle class is fleeing from. But if they had the same policies in Arizona, they would run things right, and it would be progressive Shangra-La for everyone.
When last I heard, the governor was desperately trying to get the few remaining rich people to remain.
Yes, CT financial recovery plan depends on rich people getting richer faster than anyone else.
But evidently hard-working Arizonans voted for this, so why shouldn’t they get it good and hard?
The good news is, that with Biden, they will be.
Oh Jon you don’t like this tax because all the filthy lucre you make from Ricochet will be taxed. You might have to sell one of your yachts to pay the tax. /sarc off/ It sounds like the Goldwater Institute has a solid case. Maybe the faculty lounge (ie Yoo and Epstein) could give us some insight. Also is this type of thing happening in other states?
Austin is already California:
Insanity Is Doing the Same Thing Over and Over Again and Expecting Different Results