Thursday, March 17, 2011

NO on the proposed Income Tax ban in Tennessee

TFT Board Member Erica Thomas has this great guest column in Memphis' Commercial Appeal:
Reliance on sales tax causes an imbalance
Tennesseans should tell their legislators they're against a prohibition on state income tax because it ensures the highest earners pay the most.

An excerpt: "While Tennesseans grapple with the potential loss of state services and funding to our communities, Kelsey and Casada are sponsoring a measure that would permanently remove one revenue option from ever being considered in the state, locking Tennessee into what could be a perpetual revenue shortfall. On Feb. 8, Kelsey introduced Senate Joint Resolution 18 that would enshrine in the Tennessee Constitution a prohibition against any tax on incomes or payroll. The Senate approved the measure Wednesday and the House will soon take up the issue.

Tennesseans for Fair Taxation has long advocated a system of taxation that requires those with the greatest ability to pay and who benefit most from our government to pay more of the cost of government. According to the Institute on Taxation and Economic Policy's "Who Pays?" report in November 2009, Tennesseans earning less than $17,000 a year pay 11.7 percent of their meager income in state and local taxes while those earning $228,000 annually pay only 4.5 percent of their abundant income. Tennessee's tax structure is the fourth most regressive tax system in the nation -- meaning that incomes are more unequal after taxes than before. It is our excessive reliance on sales and other consumption taxes that causes the imbalance. The only way to correct this "upside-down" tax structure is to add a broad-based income tax and simultaneously reduce the oppressive sales tax."

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