State talks reducing top tax rate

[TexasTowelie]

LITTLE ROCK—Arkansas officials are proposing income tax changes estimated to reduce state revenue by nearly $192 million a year.

The Arkansas Department of Finance and Administration unveiled the proposed tax relief package Wednesday to the Legislative Tax Reform and Relief Task Force, the Arkansas Democrat-Gazette reported .

The proposal this week seeks to simplify rates and tax brackets by turning Arkansas' three individual income tax tables into a single table. The top rate would also gradually be cut from 6.9 percent to 5.9 percent, making a total reduced revenue of $191.7 million a year.

"When you look at this thing fully phased in at 5.9 percent, it seems like an extremely effective way to get $200 million in income tax relief, where nobody pays more taxes, everybody sees some benefits," said Republican Rep. Charlie Collins. "It is a very simple (income tax) code. There are a few brackets, and it is well-structured for future tax relief."

Read more: http://www.texarkanagazette.com/news/arkansas/story/2018/aug/24/state-talks-reducing-top-tax-rate/740223/

[Farmer-Rick]

1. So how are they going to pay their huge debt if they reduce revenue?

They are ranked 41 highest debt owed (44 per capita) among the 50 states and that does not include local debt.

Reducing income when your debt is so large does NOT sound like a smart thing to do.

[sinkingfeeling]

2. That means there are only 9 states with a lower debt.

[Farmer-Rick]

3. No, the data I was looking at had Alabama at the bottom with the next state down having even more

Debt in raw numbers. But now I can't find it....maybe it was old data because all I can find now is listing Alabama as above average in financial stability. And yet the state poverty is so horrible it shocked a UN study. You would think they would use the money to improve the poverty in the state instead of giving the rich yet another tax break.

[sinkingfeeling]

4. This is the data from 2015.

37.  Arkansas
> Debt per capita: $1,522 (5th lowest)
> 2015 Unemployment rate: 5.2% (tied-25th highest)
> Credit rating: Aa1/AA
> Poverty: 19.1% (4th highest)

With a median household income of $41,995 a year, Arkansas is the second least wealthy state in the country. Arkansas is also one of just a few states without any reserve coffers. Despite lower resident incomes and limited savings, Arkansas has managed to maintain a fairly balanced budget without amassing large debt. The state’s debt is equivalent to just 19.4% of total revenue, far less than the 48.7% average across 

https://247wallst.com/special-report/2016/12/06/the-best-and-worst-run-states-in-america-2/9/

[Farmer-Rick]

5. Yeah, I saw that.

They should use their budget to reduce poverty instead of another tax give away to the rich.