Monday, November 29, 2004
Attacking the blue states
Apperently Bush's new tax plan will bite we Blute statesmen right on the ass!
|
Apperently Bush's new tax plan will bite we Blute statesmen right on the ass!
In the past election, the states that collect the most income tax were solidly “blue” supporters of Democratic challenger John Kerry.
Eight of the 10 states with the most revenue in 2000 voted for Kerry: California, New York, Pennsylvania, Massachusetts, Michigan, Illinois, New Jersey and Maryland. Only Ohio and North Carolina favored Bush.
The federal deduction for state and local income taxes “predominantly benefits the blue states,” said William Gale, a tax policy expert at the Brookings Institution, a liberal-leaning research group. “There is definitely a political calculation to this.”
But before conspiracy theorists get too carried away, political observers note that by eliminating deductions for state income taxes, Bush would be inflicting political pain on two of the nation’s most prominent Republican governors, George Pataki of New York and Arnold Schwarzenegger of California.
And they’ll be watching closely to see if Bush will also seek to end the federal deduction for property taxes.
That would spread the pain more widely, including to “red” Texas and Florida, which collect little or no income tax but rely heavily on property taxes. However, it would rile real estate interests, one of the most powerful lobbies in Washington.
Seven states are big gainers under the new law, because they have sales taxes but little or no income tax. Six of them — Texas, Florida, Nevada, South Dakota, Tennessee and Wyoming — voted for Bush. Washington is the only state in the group that went for Kerry.
But in the states that have long depended on federal deductions to soften the blow of state income taxes, the change could have a serious impact. State legislatures that face budget deficits might be forced to cut services or shift to other sources of income, such as lotteries, because they would not be able to muster political support for higher income taxes.
|
